XOOM, INC.
1998 STOCK INCENTIVE PLAN
1. PURPOSES OF THE PLAN. The purposes of this Stock Incentive Plan are
to attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees, Directors and
Consultants and to promote the success of the Company's business.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) 'ADMINISTRATOR' means the Board or any of the Committees
appointed to administer the Plan.
(b) 'APPLICABLE LAWS' means the legal requirements relating to
the administration of stock incentive plans, if any, under applicable provisions
of federal securities laws, California corporate and securities laws, the Code,
the rules of any applicable stock exchange or national market system, and the
rules of any foreign jurisdiction applicable to Awards granted to residents
therein.
(c) 'AWARD' means the grant of an Option, Restricted Stock,
SAR or other right or benefit under the Plan.
(d) 'AWARD AGREEMENT' means the written agreement evidencing
the grant of an Award executed by the Company and the Grantee, including any
amendments thereto.
(e) 'BOARD' means the Board of Directors of the Company.
(f) 'CHANGE IN CONTROL' means a change in ownership or control
of the company effected through the following transaction, other than a Change
in Control that is also a sale of Common Stock to the general public pursuant to
a registration statement filed with and declared effective by the Securities and
Exchange Commission under the Securities Act of 1933, as amended: the direct or
indirect acquisition (including pursuant to the issuance of authorized, but
unissued securities of the Company) by any person or related group of persons
(other than an acquisition from or by the Company or by a Company-sponsored
employee benefit plan or by a person that directly or indirectly controls, is
controlled by, or is under common control with, the Company) of beneficial
ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities
possessing more than fifty percent (50%) of the total combined voting power of
the Company's outstanding securities pursuant to a tender offer or exchange
offer made directly to the Company's stockholders that occurs after the
Registration Date.
(g) 'CODE' means the Internal Revenue Code of 1986, as
amended.
(h) 'COMMITTEE' means any committee appointed by the Board to
administer the Plan.
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(i) 'COMMON STOCK' means the common stock of the Company.
(j) 'COMPANY' means XOOM, Inc.
(k) 'CONSULTANT' means any person who is engaged by the
Company or Related Entity to render consulting or advisory services as an
independent contractor and is compensated for such services.
(l) 'CONTINUOUS STATUS AS AN EMPLOYEE, DIRECTOR OR CONSULTANT'
means that the provision of services to the Company or a Related Entity in any
capacity of Employee, Director or Consultant, is not interrupted or terminated.
Continuous Status as an Employee, Director or Consultant shall not be considered
interrupted in the case of (i) any approved leave of absence, (ii) transfers
between locations of the Company or among the Company, any Related Entity, or
any successor, in any capacity of Employee, Director or Consultant, or (iii) any
change in status as long as the individual remains in the service of the Company
or a Related Entity in any capacity of Employee, Director or Consultant (except
as otherwise provided in the Award Agreement). An approved leave of absence
shall include sick leave, military leave, or any other authorized personal
leave. For purposes of Incentive Stock Options, no such leave may exceed ninety
(90) days, unless reemployment upon expiration of such leave is guaranteed by
statute or contract.
(m) 'CORPORATE TRANSACTION' means 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 a transaction the principal purpose of
which is to change the state in which the Company is incorporated;
(ii) the sale, transfer or other disposition of all
or substantially all of the assets of the Company (including the capital stock
of the Company's subsidiary corporations) in connection with the complete
liquidation or dissolution of the Company; or
(iii) any reverse merger in which the Company is the
surviving entity but in which securities possessing more than fifty percent
(50%) of the total combined voting power of the Company's outstanding securities
are transferred to a person or persons different from those who held such
securities immediately prior to such merger; provided that if such merger is
preceded by a Change in Control within six (6) months of the merger, then a
Corporate Transaction will be deemed to have occurred if securities possessing
more than fifty percent (50%) of the total combined voting power of the
Company's outstanding securities are transferred pursuant to such merger to a
person or persons different from those who held such securities immediately
prior to such Change in Control.
(n) 'DIRECTOR' means a member of the Board.
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(o) 'EMPLOYEE' means any person, including an Officer or
Director, who is an employee of the Company or any Related Entity. The payment
of a director's fee by the Company shall not be sufficient to constitute
'employment' by the Company.
(p) 'EXCHANGE ACT' means the Securities Exchange Act of 1934,
as amended.
(q) 'FAIR MARKET VALUE' means, as of any date, the value of
Common Stock determined as follows:
(i) Where there exists a public market for the Common
Stock, the Fair Market Value shall be (A) the closing price for a Share for the
last market trading day prior to the time of the determination (or, if no
closing price was reported on that date, on the last trading date on which a
closing price was reported) on the stock exchange determined by the
Administrator to be the primary market for the Common Stock or the Nasdaq
National Market, whichever is applicable or (B) if the Common Stock is not
traded on any such exchange or national market system, the average of the
closing bid and asked prices of a Share on the Nasdaq Small Cap Market for the
day prior to the time of the determination (or, if no such prices were reported
on that date, on the last date on which such prices were reported), in each
case, as reported in THE WALL STREET JOURNAL or such other source as the
Administrator deems reliable; or
(ii) In the absence of an established market of the
type described in paragraph (i), above, for the Common Stock, the Fair Market
Value thereof shall be determined by the Administrator in good faith and in a
manner consistent with Section 260.140.50 of Title 10 of the California Code of
Regulations.
(r) 'GRANTEE' means an Employee, Director or Consultant who
receives an Award under the Plan.
(s) 'INCENTIVE STOCK OPTION' means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.
(t) 'NON-QUALIFIED STOCK OPTION' means an Option not intended
to qualify as an Incentive Stock Option.
(u) 'OFFICER' means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(v) 'OPTION' means a stock option granted pursuant to the
Plan.
(w) 'PARENT' means a 'parent corporation,' whether now or
hereafter existing, as defined in Section 424(e) of the Code.
(x) 'PLAN' means this 1998 Stock Incentive Plan.
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(y) 'REGISTRATION DATE' means the closing of the first sale of
Common Stock to the general public pursuant to a registration statement filed
with and declared effective by the Securities and Exchange Commission under the
Securities Act of 1933, as amended.
(z) 'RELATED ENTITY' means any Parent, Subsidiary and any
business, corporation, partnership, limited liability company or other entity in
which the Company, a Parent or a Subsidiary holds a significant ownership
interest, directly or indirectly as determined by the Plan Administrator.
(aa) 'RESTRICTED STOCK' means Shares issued under the Plan to
the Grantee for such consideration, if any, and subject to such restrictions on
transfer, rights of first refusal, repurchase provisions, forfeiture provisions,
and other terms and conditions as established by the Administrator.
(bb) 'SAR' means a stock appreciation right entitling the
Grantee to Shares or cash compensation, as established by the Administrator,
measured by appreciation in the value of Common Stock.
(cc) 'SHARE' means a share of the Common Stock.
(dd) 'SUBSIDIARY' means a 'subsidiary corporation,' whether
now or hereafter existing, as defined in Section 424(f) of the Code.
3. STOCK SUBJECT TO THE PLAN.
(a) Subject to the provisions of Section 11(a), below, the
maximum aggregate number of Shares which may be issued pursuant to all Awards
(including Incentive Stock Options) is 5,000,000 Shares. The Shares may be
authorized, but unissued, or reacquired Common Stock. Notwithstanding the
foregoing, the total number of Shares issuable upon exercise of all outstanding
Awards shall not exceed a number of Shares which is equal to 30% of the then
outstanding shares of the Company, as calculated in accordance with the
conditions and exclusions of California Corporate Securities Rule 260.140.45,
unless a percentage higher than 30% is approved by at least two-thirds of the
outstanding Shares entitled to vote.
(b) If an Award expires or becomes unexercisable without
having been exercised in full, or is surrendered pursuant to an Award exchange
program, or if any unissued Shares are retained by the Company upon exercise of
an Award in order to satisfy the exercise price for such Award or any
withholding taxes due with respect to such Award, such unissued or retained
Shares shall become available for future grant or sale under the Plan (unless
the Plan has terminated). Shares that actually have been issued under the Plan
pursuant to an Award shall not be returned to the Plan and shall not become
available for future distribution under the Plan, except that if unvested Shares
are forfeited, or repurchased by the Company at their original purchase price,
such Shares shall become available for future grant under the Plan.
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4. ADMINISTRATION OF THE PLAN.
(a) PLAN ADMINISTRATOR. With respect to grants of Awards to
Employees, Directors, Officers or Consultants, the Plan shall be administered by
(A) the Board or (B) a Committee (or a subcommittee of the Committee) designated
by the Board, which Committee shall be constituted in such a manner as to
satisfy Applicable Laws. Once appointed, such Committee shall continue to serve
in its designated capacity until otherwise directed by the Board. The Board may
authorize one or more Officers to grant such Awards and may limit such authority
as the Board determines from time to time.
(b) MULTIPLE ADMINISTRATIVE BODIES. The Plan may be
administered by different bodies with respect to Directors, Officers,
Consultants, and Employees who are neither Directors nor Officers.
(c) POWERS OF THE ADMINISTRATOR. Subject to Applicable Laws
and the provisions of the Plan (including any other powers given to the
Administrator hereunder), and except as otherwise provided by the Board, the
Administrator shall have the authority, in its discretion:
(i) to select the Employees, Directors and
Consultants to whom Awards may be granted from time to time hereunder;
(ii) to determine whether and to what extent Awards
are granted hereunder;
(iii) to determine the number of Shares or the amount
of other consideration to be covered by each Award granted hereunder;
(iv) to approve forms of Award Agreement for use
under the Plan;
(v) to determine the terms and conditions of any
Award granted hereunder;
(vi) to establish additional terms, conditions, rules
or procedures to accommodate the rules or laws of applicable foreign
jurisdictions and to afford Grantees favorable treatment under such laws;
provided, however, that no Award shall be granted under any such additional
terms, conditions, rules or procedures with terms or conditions which are
inconsistent with the provisions of the Plan;
(vii) to amend the terms of any outstanding Award
granted under the Plan, including a reduction in the exercise price (or base
amount on which appreciation is measured) of any Award to reflect a reduction in
the Fair Market Value of the Common Stock since the grant date of the Award,
provided that any amendment that would adversely affect the Grantee's rights
under an outstanding Award shall not be made without the Grantee's written
consent;
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(viii) to construe and interpret the terms of the
Plan and Awards granted pursuant to the Plan; and
(ix) to take such other action, not inconsistent with
the terms of the Plan, as the Administrator deems appropriate.
(d) EFFECT OF ADMINISTRATOR'S DECISION. All decisions,
determinations and interpretations of the Administrator shall be conclusive and
binding on all persons.
5. ELIGIBILITY. Awards other than Incentive Stock Options may be
granted to Employees, Directors and Consultants. Incentive Stock Options may be
granted only to Employees of the Company, a Parent or a Subsidiary. An Employee,
Director or Consultant who has been granted an Award may, if otherwise eligible,
be granted additional Awards. Awards may be granted to such Employees, Directors
or Consultants who are residing in foreign jurisdictions as the Administrator
may determine from time to time.
6. TERMS AND CONDITIONS OF AWARDS.
(a) TYPE OF AWARDS. The Administrator is authorized under the
Plan to award any type of arrangement to an Employee, Director or Consultant
that is not inconsistent with the provisions of the Plan and that by its terms
involves or might involve the issuance of (i) Shares, (ii) an Option, a SAR or
similar right with an exercise or conversion privilege at a fixed or variable
price related to the Common Stock and/or the passage of time, the occurrence of
one or more events, or the satisfaction of performance criteria or other
conditions, or (iii) any other security with the value derived from the value of
the Common Stock or securities issued by a Related Entity. Such awards include,
without limitation, Options, sales or bonuses of Restricted Stock, SARs, and an
Award may consist of one such security or benefit, or two or more of them in any
combination or alternative.
(b) DESIGNATION OF AWARD. Each Award shall be designated in
the Award Agreement. In the case of an Option, the Option shall be designated as
either an Incentive Stock Option or a Non-Qualified Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of Shares subject to Options designated as Incentive Stock Options which
become exercisable for the first time by a Grantee during any calendar year
(under all plans of the Company or any Parent or Subsidiary) exceeds $100,000,
such excess Options, to the extent of the Shares covered thereby in excess of
the foregoing limitation, shall be treated as Non-Qualified Stock Options. For
this purpose, Incentive Stock Options shall be taken into account in the order
in which they were granted, and the Fair Market Value of the Shares shall be
determined as of the date the Option with respect to such Shares is granted.
(c) CONDITIONS OF AWARD. Subject to the terms of the Plan, the
Administrator shall determine the provisions, terms, and conditions of each
Award including, but not limited to, the Award vesting schedule, repurchase
provisions, rights of first refusal, forfeiture provisions, form of payment
(cash, Shares, or other consideration) upon settlement of the Award, payment
contingencies, and satisfaction of any performance criteria. The performance
criteria established by the Administrator may be based on any one of, or
combination of, increase in share price,
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earnings per share, total stockholder return, return on equity, return on
assets, return on investment, net operating income, cash flow, revenue, economic
value added, personal management objectives, or other measure of performance
selected by the Administrator. Partial achievement of the specified criteria may
result in a payment or vesting corresponding to the degree of achievement as
specified in the Award Agreement.
(d) DEFERRAL OF AWARD PAYMENT. The Administrator may establish
one or more programs under the Plan to permit selected Grantees the opportunity
to elect to defer receipt of consideration upon exercise of an Award,
satisfaction of performance criteria, or other event that absent the election
would entitle the Grantee to payment or receipt of Shares or other consideration
under an Award. The Administrator may establish the election procedures, the
timing of such elections, the mechanisms for payments of, and accrual of
interest or other earnings, if any, on amounts, Shares or other consideration so
deferred, and such other terms, conditions, rules and procedures that the
Administrator deems advisable for the administration of any such deferral
program.
(e) AWARD EXCHANGE PROGRAMS. The Administrator may establish
one or more programs under the Plan to permit selected Grantees to exchange an
Award under the Plan for one or more other types of Awards under the Plan on
such terms and conditions as determined by the Administrator from time to time.
(f) SEPARATE PROGRAMS. The Administrator may establish one or
more separate programs under the Plan for the purpose of issuing particular
forms of Awards to one or more classes of Grantees on such terms and conditions
as determined by the Administrator from time to time.
(g) EARLY EXERCISE. The Award may, but need not, include a
provision whereby the Grantee may elect at any time while an Employee, Director
or Consultant to exercise any part or all of the Award prior to full vesting of
the Award. Any unvested Shares received pursuant to such exercise may be subject
to a repurchase right in favor of the Company or to any other restriction the
Administrator determines to be appropriate.
(h) TERM OF AWARD. The term of each Award shall be the term
stated in the Award Agreement, provided, however, that the term shall be no more
than ten (10) years from the date of grant thereof. However, in the case of an
Incentive Stock Option granted to a Grantee who, at the time the Option is
granted, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary, the term of
the Incentive Stock Option shall be five (5) years from the date of grant
thereof or such shorter term as may be provided in the Award Agreement.
(i) NON-TRANSFERABILITY OF AWARDS. Awards may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Grantee, only by the Grantee.
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(j) Time of Granting Awards. The date of grant of an Award
shall for all purposes be the date on which the Administrator makes the
determination to grant such Award, or such other date as is determined by the
Administrator. Notice of the grant determination shall be given to each
Employee, Director or Consultant to whom an Award is so granted within a
reasonable time after the date of such grant.
7. AWARD EXERCISE OR PURCHASE PRICE, CONSIDERATION, TAXES AND RELOAD
OPTIONS.
(a) Exercise or Purchase Price. The exercise or purchase
price, if any, for an Award shall be as follows:
(i) In the case of an Incentive Stock Option:
(A) granted to an Employee who, at the time
of the grant of such Incentive Stock Option owns stock representing more than
ten percent (10%) of the voting power of all classes of stock of the Company or
any Parent or Subsidiary, the per Share exercise price shall be not less than
one hundred ten percent (110%) of the Fair Market Value per Share on the date of
grant.
(B) granted to any Employee other than an
Employee described in the preceding paragraph, the per Share exercise price
shall be not less than one hundred percent (100%) of the Fair Market Value per
Share on the date of grant.
(ii) In the case of a Non-Qualified Stock Option:
(A) granted to a person who, at the time of
the grant of such Option, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be not less than one hundred ten
percent (110%) of the Fair Market Value per Share on the date of grant.
(B) granted to any person other than a
person described in the preceding paragraph, the per Share exercise price shall
be not less than eighty-five percent (85%) of the Fair Market Value per Share on
the date of grant.
(iii) In the case of the sale of Shares:
(A) granted to a person who, at the time of
the grant of such Award, or at the time the purchase is consummated, owns stock
representing more than ten percent (10%) of the voting power of all classes of
stock of the Company or any Parent or Subsidiary, the per Share purchase price
shall be not less than one hundred percent (100%) of the Fair Market Value per
share on the date of grant.
(B) granted to any person other than a
person described in the preceding paragraph, the per Share purchase price shall
be not less than eighty-five percent (85%) of the Fair Market Value per Share on
the date of grant.
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(iv) In the case of other Awards, such price as is
determined by the Administrator.
(b) CONSIDERATION. Subject to Applicable Laws, the
consideration to be paid for the Shares to be issued upon exercise or purchase
of an Award including the method of payment, shall be determined by the
Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant). In addition to any other types of
consideration the Administrator may determine, the Administrator is authorized
to accept as consideration for Shares issued under the Plan the following:
(i) cash;
(ii) check;
(iii) delivery of Grantee's promissory note with such
recourse, interest, security, and redemption provisions as the Administrator
determines as appropriate;
(iv) if the exercise occurs on or after the
Registration Date, surrender of Shares or delivery of a properly executed form
of attestation of ownership of Shares as the Administrator may require
(including withholding of Shares otherwise deliverable upon exercise of the
Award) which have a Fair Market Value on the date of surrender or attestation
equal to the aggregate exercise price of the Shares as to which said Award shall
be exercised (but only to the extent that such exercise of the Award would not
result in an accounting compensation charge with respect to the Shares used to
pay the exercise price unless otherwise determined by the Administrator);
(v) if the exercise occurs on or after the
Registration Date, delivery of a properly executed exercise notice together with
such other documentation as the Administrator and the broker, if applicable,
shall require to effect an exercise of the Award and delivery to the Company of
the sale or loan proceeds required to pay the exercise price; or
(vi) any combination of the foregoing methods of
payment.
(c) TAXES. No Shares shall be delivered under the Plan to any
Grantee or other person until such Grantee or other person has made arrangements
acceptable to the Administrator for the satisfaction of any foreign, federal,
state, or local income and employment tax withholding obligations, including,
without limitation, obligations incident to the receipt of Shares or the
disqualifying disposition of Shares received on exercise of an Incentive Stock
Option. Upon exercise of an Award the Company shall withhold or collect from
Grantee an amount sufficient to satisfy such tax obligations.
(d) RELOAD OPTIONS. In the event the exercise price or tax
withholding of an Option is satisfied by the Company or the Grantee's employer
withholding Shares otherwise deliverable to the Grantee, the Administrator may
issue the Grantee an additional Option, with
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terms identical to the Award Agreement under which the Option was exercised, but
at an exercise price as determined by the Administrator in accordance with the
Plan.
8. EXERCISE OF AWARD.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A STOCKHOLDER.
(i) Any Award granted hereunder shall be exercisable
at such times and under such conditions as determined by the Administrator under
the terms of the Plan and specified in the Award Agreement but in the case of an
Option, in no case at a rate of less than 20% per year over five (5) years from
the date the Option is granted, subject to reasonable conditions such as
continued employment. However, in the case of an Option granted to an Officer,
Director or Consultant, the Award Agreement may provide that the Option may
become fully exercisable, subject to reasonable conditions such as continued
employment, at any time or during any period established in the Award Agreement.
(ii) An Award shall be deemed to be exercised when
written notice of such exercise has been given to the Company in accordance with
the terms of the Award by the person entitled to exercise the Award and full
payment for the Shares with respect to which the Award is exercised has been
received by the Company. Until the issuance (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized transfer agent of the
Company) of the stock certificate evidencing such Shares, no right to vote or
receive dividends or any other rights as a stockholder shall exist with respect
to Shares subject to an Award, notwithstanding the exercise of an Option or
other Award. The Company shall issue (or cause to be issued) such stock
certificate promptly upon exercise of the Award. No adjustment will be made for
a dividend or other right for which the record date is prior to the date the
stock certificate is issued, except as provided in the Award Agreement or
Section 11(a), below.
(b) EXERCISE OF AWARD FOLLOWING TERMINATION OF EMPLOYMENT,
DIRECTOR OR CONSULTING RELATIONSHIP. In the event of termination of a grantee's
Continuous Status as an Employee, Director or Consultant for any reason other
than disability or death (but not in the event of a Grantee's change of status
from Employee to Consultant or from Consultant to Employee), such Grantee may,
but only within three (3) months after the date of such termination (but in no
event later than the expiration date of the term of such Award as set forth in
the Award Agreement), exercise his or her Award to the extent that the Grantee
was entitled to exercise it at the date of such termination or to such other
extent as may be determined by the Administrator. The Grantee's Award Agreement
may provide that upon the event of termination of the Grantee's Continuous
Status as an Employee, Director or Consultant for 'Cause,' the Grantee's right
to exercise the Award shall terminate concurrently with the termination of
Grantee's Continuous Status as an Employee, Director or Consultant. The term
'Cause' shall be as defined in the Award Agreement. If the Grantee should die
within three (3) months after the date of such termination, the Grantee's estate
or the person who acquired the right to exercise the Award by bequest or
inheritance may exercise the Award to the extent that the Grantee was entitled
to exercise it at the date of such termination within twelve (12) months of the
Grantee's date of death, but in no event later than the expiration date of the
term of such Award as set forth
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in the Award Agreement. In the event of a Grantee's change of status from
Employee to Consultant, an Employee's Incentive Stock Option shall convert
automatically to a Non-Qualified Stock Option on the day three (3) months and
one day following such change of status. To the extent that the Grantee is not
entitled to exercise the Award at the date of termination, or if Grantee does
not exercise such Award to the extent so entitled within the time specified
herein, the Award shall terminate.
(c) DISABILITY OF GRANTEE. In the event of termination of a
Grantee's Continuous Status as an Employee, Director or Consultant as a result
of his or her disability, Grantee may, but only within twelve (12) months from
the date of such termination (and in no event later than the expiration date
of the term of such Award as set forth in the Award Agreement), exercise the
Award to the extent otherwise entitled to exercise it at the date of such
termination; provided, however, that if such disability is not a 'disability'
as such term is defined in Section 22(e)(3) of the Code, in the case of an
Incentive Stock Option such Incentive Stock Option shall automatically convert
to a Non-Qualified Stock Option on the day three (3) months and one day
following such termination. To the extent that the Grantee is not entitled to
exercise the Award at the date of termination, or if Grantee does not exercise
such Award to the extent so entitled within the time specified herein, the
Award shall terminate.
(d) DEATH OF GRANTEE. In the event of the death of a Grantee,
the Award may be exercised at any time within twelve (12) months following the
date of death (but in no event later than the expiration of the term of such
Award as set forth in the Award Agreement), by the Grantee's estate or by a
person who acquired the right to exercise the Award by bequest or inheritance,
but only to the extent that the Grantee was entitled to exercise the Award at
the date of death. If, at the time of death, the Grantee was not entitled to
exercise his or her entire Award, the Shares covered by the unexercisable
portion of the Award shall immediately revert to the Plan. If, after death, the
Grantee's estate or a person who acquired the right to exercise the Award by
bequest or inheritance does not exercise the Award within the time specified
herein, the Award shall terminate.
(e) BUYOUT PROVISIONS. The Administrator may at any time offer
to buy out for a payment in cash or Shares, an Award previously granted, based
on such terms and conditions as ffthe Administrator shall establish and
communicate to the Grantee at the time that such offer is made.
9. CONDITIONS UPON ISSUANCE OF SHARES.
(a) Shares shall not be issued pursuant to the exercise of an
Award unless the exercise of such Award and the issuance and delivery of such
Shares pursuant thereto shall comply with all Applicable Laws, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.
(b) As a condition to the exercise of an Award, the Company
may require the person exercising such Award to represent and warrant at the
time of any such exercise that the Shares are being purchased only for
investment and without any present intention to sell or
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distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required by any Applicable Laws.
10. REPURCHASE RIGHTS. If the provisions of an Award Agreement grant to
the Company the right to repurchase Shares upon termination of the Grantee's
Continuous Status as an Employee, Director or Consultant, the Award Agreement
shall provide that the repurchase price will be either:
(a) Not less than the Fair Market Value of the Shares to be
repurchased on the date of termination of the Grantee's Continuous Status as an
Employee, Director or Consultant, and the right to repurchase must be exercised
for cash or cancellation of purchase money indebtedness for the Shares within
ninety (90) days of the termination of the Grantee's Continuous Status as an
Employee, Director or Consultant (or in the case of Shares issued upon exercise
of Awards after the date of termination of the Grantee's Continuous Status as an
Employee, Director or Consultant, within ninety (90) days after the date of the
Award exercise), and the right terminates when the Company's securities become
publicly traded; or
(b) The original purchase price, provided that the right to
repurchase at the original purchase price lapses at the rate of at least twenty
percent (20%) of the Shares subject to the Award per year over five (5) years
from the date the Award is granted (without respect to the date the Award was
exercised or became exercisable), and the right to repurchase must be exercised
for cash or cancellation of purchase money indebtedness for the Shares within
ninety (90) days of termination of the Grantee's Continuous Status as an
Employee, Director or Consultant (or in the case of Shares issued upon exercise
of Awards after the date of termination of the Grantee's Continuous Status as an
Employee, Director or Consultant, within ninety (90) days after the date of the
Award exercise).
(c) In addition to the restrictions set forth in (a) and (b)
above, the Shares held by an Officer, Director or Consultant may be subject to
additional or greater restrictions.
11. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR CORPORATE
TRANSACTION.
(a) ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. Subject to any
required action by the stockholders of the Company, the number of Shares covered
by each outstanding Award, and the number of Shares which have been authorized
for issuance under the Plan but as to which no Awards have yet been granted or
which have been returned to the Plan, as well as the price per share of Common
Stock covered by each such outstanding Award, shall be proportionately adjusted
for any increase or decrease in the number of issued shares of Common Stock
resulting from a stock split, reverse stock split, stock dividend, combination
or reclassification of the Common Stock, or any other similar event resulting in
an increase or decrease in the number of issued shares of Common Stock. Except
as expressly provided herein, no issuance by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason hereof shall be made with respect to, the
number or price of Shares subject to an Award.
12
(b) CORPORATE TRANSACTION. In the event of a proposed
Corporate Transaction, the Administrator shall notify the Grantee at least
fifteen (15) days prior to such proposed Corporate Transaction and each Award
which is at the time outstanding under the Plan shall immediately prior to the
specified effective date of such Corporate Transaction, automatically become
fully vested and exercisable and be released from any restrictions on transfer
and repurchase or forfeiture rights with respect to seventy-five percent (75%)
of the unvested Shares at the time represented by such Award. Notwithstanding
the foregoing, the Administrator, in its discretion, may prevent the
acceleration of vesting and release from any restrictions on transfer and
repurchase or forfeiture rights of any outstanding Award with respect to any
Corporate Transaction. To the extent it has not been previously exercised, the
Award will terminate immediately prior to the consummation of such proposed
Corporate Transaction, unless the Award is assumed or an equivalent Award is
substituted by the successor corporation or a Parent or Subsidiary of such
successor corporation. For the purposes of this subsection, the Award shall be
considered assumed if, following the Corporate Transaction, the Award confers,
for each Share subject to the Award immediately prior to the Corporate
Transaction, (i) the consideration (whether stock, cash, or other securities or
property) received in the Corporate Transaction by holders of Common Stock for
each Share subject to the Award held on the effective date of the Corporate
Transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares), or
(ii) the right to purchase such consideration in the case of an Option or
similar Award; provided, however, that if such consideration received in the
Corporate Transaction was not solely common stock of the successor corporation
or its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the exercise or
exchange of the Award for each Share subject to the Award to be solely common
stock of the successor corporation or its Parent equal in fair market value to
the per share consideration received by holders of Common Stock in the Corporate
Transaction.
12. TERM OF PLAN. The Plan shall become effective upon the earlier to
occur of its adoption by the Board or its approval by the stockholders of the
Company. It shall continue in effect for a term of ten (10) years unless sooner
terminated.
13. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN.
(a) The Board may at any time amend, suspend or terminate the
Plan. To the extent necessary to comply with Applicable Laws, the Company shall
obtain stockholder approval of any Plan amendment in such a manner and to such a
degree as required.
(b) No Award may be granted during any suspension of the Plan
or after termination of the Plan.
(c) Any amendment, suspension or termination of the Plan shall
not affect Awards already granted, and such Awards shall remain in full force
and effect as if the Plan had not been amended, suspended or terminated, unless
mutually agreed otherwise between the Grantee and the Administrator, which
agreement must be in writing and signed by the Grantee and the Company.
13
14. RESERVATION OF SHARES.
(a) The Company, during the term of the Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.
(b) The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been
obtained.
15. NO EFFECT ON TERMS OF EMPLOYMENT. The Plan shall not confer upon
any Grantee any right with respect to continuation of employment or consulting
relationship with the Company, nor shall it interfere in any way with his or her
right or the Company's right to terminate his or her employment or consulting
relationship at any time, with or without cause.
16. STOCKHOLDER APPROVAL. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such stockholder approval shall be obtained
in the degree and manner required under Applicable Laws. Any Award exercised
before stockholder approval is obtained shall be rescinded if stockholder
approval is not obtained within the time prescribed, and Shares issued on the
exercise of any such Award shall not be counted in determining whether
stockholder approval is obtained.
17. INFORMATION TO GRANTEES. The Company shall provide to each Grantee,
during the period for which such Grantee has one or more Awards outstanding,
copies of financial statements at least annually, and all annual reports and
other information which is provided to all stockholders of the Company.
14
XOOM.COM, INC. 1998 STOCK INCENTIVE PLAN
NOTICE OF STOCK OPTION GRANT
Optionee's Name and Address:
----------------------------------
----------------------------------
----------------------------------
You have been granted an option to purchase shares of Common Stock of
the Company, subject to the terms and conditions of the Plan and the Option
Agreement, as follows:
Grant Number
----------------------------------
Date of Grant
----------------------------------
Vesting Commencement Date
----------------------------------
Exercise Price per Share $
----------------------------------
Total Number of Shares Granted
----------------------------------
Total Exercise Price $
----------------------------------
Type of Option: Incentive Stock Option
----------------------------------
Non-Qualified Stock Option
----------------------------------
Expiration Date:
----------------------------------
VESTING SCHEDULE:
Subject to other limitations set forth in the Option Agreement, the
Option may be exercised, i.e., 'vest,' in whole or in part, in accordance with
the following schedule:
(i) [Twenty-five percent (25%) of the Shares subject to the Option
shall vest at the end of the twelfth full month after the
Vesting Commencement Date, after which 1/48th of the Shares
subject to the Option shall vest on the last day of each
calendar month thereafter]; LESS THAN TWENTY-FIVE PERCENT
(25%) OF THE SHARES SUBJECT TO THE OPTION SHALL VEST AT THE
END OF THE TWELFTH FULL MONTH AFTER THE VESTING COMMENCEMENT
DATE, AND AN ADDITIONAL TWENTY-FIVE PERCENT 25% OF THE SHARES
SUBJECT TO THE OPTION SHALL VEST ON EACH YEARLY ANNIVERSARY OF
THE VESTING COMMENCEMENT DATE THEREAFTER. GREATER THAN LESS
THAN NOTE: USE SECOND ALTERNATIVE FOR VESTING TERMS FOR
INCENTIVE STOCK OPTION, IF $100,000 ISO RULE WOULD BE VIOLATED
UNDER 1 YEAR VESTING FOLLOWED BY MONTHLY VESTING GREATER THAN
(ii) During any authorized leave of absence, the vesting of the
Option as provided in this schedule shall cease after the
leave of absence exceeds a period of ninety (90) days. Vesting
of the Option shall resume upon the Optionee's termination of
the leave of absence and return to service with the Company or
a Related Entity;
1
(iii) In the event of the Optionee's change in status from Employee
to Consultant, vesting of the Option shall continue only to
the extent determined by the Administrator as of such change
in status.
TERMINATION PERIOD:
The Option may be exercised as to the number of shares that are Vested
on the date of termination within three (3) months from termination of the
Optionee's Continuous Status as an Employee, Director or Consultant or such
longer period as may be applicable upon death or disability of the Optionee as
provided in the Option Agreement. In the event of the Optionee's change in
status from Employee to Consultant or Consultant to Employee, the Option shall
remain in effect; provided, however, that in the event of a change in status
from Employee to Consultant, the Optionee's Incentive Stock Option shall cease
to be treated as an Incentive Stock Option and shall be treated as a
Non-Qualified Stock Option on the day three (3) months and one day following
such change in status. In no event shall the Option be exercised later than the
Expiration Date as provided above.
IN WITNESS WHEREOF, the Company and the Optionee have executed this
Notice of Stock Option Grant and agree that the Option is to be governed by the
terms and conditions of this Notice of Stock Option Grant, the Plan, and the
Option Agreement.
XOOM.com, Inc.,
a Delaware corporation
By:
----------------------------------
Its:
----------------------------------
THE OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR EMPLOYMENT AT THE WILL
OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR
ACQUIRING SHARES HEREUNDER). THE OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
NOTHING IN THIS NOTICE OF STOCK OPTION GRANT, THE OPTION AGREEMENT, NOR IN THE
COMPANY'S 1998 STOCK INCENTIVE PLAN, SHALL CONFER UPON THE OPTIONEE ANY RIGHT
WITH RESPECT TO CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR
SHALL IT INTERFERE IN ANY WAY WITH THE OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT
TO TERMINATE THE OPTIONEE'S EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR
WITHOUT CAUSE.
2
The Optionee acknowledges receipt of a copy of the Plan and the Option
Agreement, and represents that he is familiar with the terms and provisions
thereof, and hereby accepts the Option subject to all of the terms and
provisions thereof. The Optionee has reviewed this Notice of Stock Option Grant,
the Plan, and the Option Agreement in their entirety, has had an opportunity to
obtain the advice of counsel prior to executing the Notice of Stock Option Grant
and fully understands all provisions of this Notice of Stock Option Grant, the
Plan, and the Option Agreement. The Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Board or
Administrator upon any questions arising under this Notice of Stock Option
Grant, the Plan, and the Option Agreement. The Optionee further agrees to notify
the Company upon any change in the residence address indicated in this Notice of
Stock Option Grant.
Dated: Signed:
----------------------------- ----------------------------
Optionee
3
XOOM.COM, INC. 1998 STOCK INCENTIVE PLAN
STOCK OPTION AGREEMENT
1. GRANT OF OPTION. XOOM.com, Inc., a Delaware corporation (the 'Company'),
hereby grants to the Optionee named in the Notice of Stock Option Grant (the
'Optionee'), an option (the 'Option') to purchase the total number of shares of
Common Stock (the 'Shares') set forth in the Notice of Stock Option Grant (the
'Notice'), at the exercise price per share set forth in the Notice (the
'Exercise Price') subject to the terms, definitions and provisions of the Notice
and the Company's 1998 Stock Incentive Plan (the 'Plan') adopted by the Company,
which are incorporated herein by reference. Unless otherwise defined herein, the
terms defined in the Plan shall have the same defined meanings in this Option
Agreement.
If designated in the Notice as an Incentive Stock Option, the Option is
intended to qualify as an Incentive Stock Option as defined in Section 422 of
the Code. Nevertheless, to the extent that it exceeds the $100,000 rule of
Section 422(d) of the Code, the Option shall be treated as a Non-Qualified Stock
Option.
2. EXERCISE OF OPTION.
(a) RIGHT TO EXERCISE. The Option shall be exercisable during its term
in accordance with the Vesting Schedule set out in the Notice and with the
applicable provisions of the Plan and this Option Agreement. In the event of
termination of Optionee's Continuous Status as an Employee, Director or
Consultant, the Option shall be exercisable in accordance with the applicable
provisions of the Plan and this Option Agreement. The Option shall be subject to
the provisions of Section 11(b) of the Plan relating to the exercisability or
termination of the Option in the event of a Corporate Transaction. No partial
exercise of the Option may be for less than the lesser of five percent (5%) of
the total number of Shares subject to the Option or the remaining number of
Shares subject to the Option. In no event shall the Company issue fractional
Shares.
(b) METHOD OF EXERCISE. The Option shall be exercisable only by
delivery of an Exercise Notice (attached as EXHIBIT A) which shall state the
election to exercise the Option, the whole number of Shares in respect of which
the Option is being exercised, and such other provisions as may be required by
the Administrator. Such Exercise Notice shall be signed by the Optionee and
shall be delivered in person or by certified mail to the Secretary of the
Company accompanied by payment of the Exercise Price. The Option shall be deemed
to be exercised upon receipt by the Company of such written notice accompanied
by the Exercise Price.
No Shares will be issued pursuant to the exercise of the Option unless
such issuance and such exercise shall comply with all Applicable Laws. Assuming
such compliance, for income tax purposes, the Shares shall be considered
transferred to the Optionee on the date on which the Option is exercised with
respect to such Shares.
(c) TAXES. No Shares will be issued to the Optionee or other person
pursuant to the exercise of the Option until the Optionee or other person has
made arrangements acceptable to
1
the Administrator for the satisfaction of foreign, federal, state and local
income and employment tax withholding obligations.
3. METHOD OF PAYMENT. Payment of the Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee; provided,
however, that such exercise method does not then violate an Applicable Law:
(a) cash;
(b) check;
(c) surrender of Shares or delivery of a properly executed form of
attestation of ownership of Shares as the Administrator may require (including
withholding of Shares otherwise deliverable upon exercise of the Option) which
have a Fair Market Value on the date of surrender or attestation equal to the
aggregate Exercise Price of the Shares as to which the Option is being exercised
(but only to the extent that such exercise of the Option would not result in an
accounting compensation charge with respect to the Shares used to pay the
exercise price); or
(d) delivery of a properly executed Exercise Notice together with such
other documentation as the Administrator and the broker, if applicable, shall
require to effect an exercise of the Option and delivery to the Company of the
sale or loan proceeds required to pay the Exercise Price.
4. RESTRICTIONS ON EXERCISE. The Option may not be exercised if the issuance of
the Shares subject to the Option upon such exercise would constitute a violation
of any Applicable Laws.
5. TERMINATION OF RELATIONSHIP. In the event the Optionee's Continuous Status as
an Employee, Director or Consultant terminates, the Optionee may, to the extent
otherwise so entitled at the date of such termination (the 'Termination Date'),
exercise the Option during the Termination Period set out in the Notice. Except
as provided in Sections 7 and 8, below, to the extent that the Optionee was not
entitled to exercise the Option on the Termination Date, or if the Optionee does
not exercise the Option within the Termination Period, the Option shall
terminate.
6. DISABILITY OF OPTIONEE. In the event the Optionee's Continuous Status as an
Employee, Director or Consultant terminates as a result of his or her
disability, the Optionee may, but only within twelve (12) months from the
Termination Date (and in no event later than the Expiration Date), exercise the
Option to the extent otherwise entitled to exercise it on the Termination Date;
provided, however, that if such disability is not a 'disability' as such term is
defined in Section 22(e)(3) of the Code and the Option is an Incentive Stock
Option, such Incentive Stock Option shall cease to be treated as an Incentive
Stock Option and shall be treated as a Non-Qualified Stock Option on the day
three (3) months and one day following the Termination Date. To the extent that
the Optionee was not entitled to exercise the Option on the Termination Date, or
if the Optionee does not exercise the Option to the extent so entitled within
the time specified herein, the Option shall terminate.
2
7. DEATH OF OPTIONEE. In the event of the Optionee's death, the Option may be
exercised at any time within twelve (12) months following the date of death (and
in no event later than the Expiration Date), by the Optionee's estate or by a
person who acquired the right to exercise the Option by bequest or inheritance,
but only to the extent the Optionee could exercise the Option at the date of
death. To the extent that the Optionee was not entitled to exercise the Option
on the date of death, or if the Option is not exercised to the extent so
entitled within the time specified herein, the Option shall terminate.
8. NON-TRANSFERABILITY OF OPTION. The Option may not be transferred in any
manner otherwise than by will or by the laws of descent or distribution and may
be exercised during the lifetime of the Optionee only by the Optionee. The terms
of the Option shall be binding upon the executors, administrators, heirs and
successors of the Optionee.
9. TERM OF OPTION. The Option may be exercised only within the term set out in
the Notice and may be exercised during such term only in accordance with the
Plan and the terms of this Option Agreement.
10. TAX CONSEQUENCES. Set forth below is a brief summary as of the date of this
Option Agreement of some of the federal tax consequences of exercise of the
Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE,
AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES.
(a) EXERCISE OF INCENTIVE STOCK OPTION. If the Option qualifies as an
Incentive Stock Option, there will be no regular federal income tax liability
upon the exercise of the Option, although the excess, if any, of the Fair Market
Value of the Shares on the date of exercise over the Exercise Price will be
treated as an adjustment to the alternative minimum tax for federal tax purposes
and may subject the Optionee to the alternative minimum tax in the year of
exercise.
(b) EXERCISE OF INCENTIVE STOCK OPTION FOLLOWING DISABILITY. If the
Optionee's Continuous Status as an Employee, Director or Consultant terminates
as a result of disability that is not total and permanent disability as defined
in Section 22(e)(3) of the Code, to the extent permitted on the date of
termination, the Optionee must exercise an Incentive Stock Option within three
(3) months of such termination for the Incentive Stock Option to be qualified as
an Incentive Stock Option.
(c) EXERCISE OF NON-QUALIFIED STOCK OPTION. There may be a regular
federal income tax liability upon the exercise of a Non-Qualified Stock Option.
The 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 the Optionee
is an Employee or a former Employee, the Company will be required to withhold
from the Optionee's compensation or collect from the Optionee and pay to the
applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise.
3
(d) DISPOSITION OF SHARES. In the case of a Non-Qualified Stock Option,
if Shares are held for at least one year, any gain realized on disposition of
the Shares will be treated as long-term capital gain for federal income tax
purposes and subject to tax at a maximum rate of 20%. In the case of an
Incentive Stock Option, if Shares transferred pursuant to the Option are held
for at least one year after receipt of the Shares and are disposed of at least
two years after the Date of Grant, any gain realized on disposition of the
Shares also will be treated as long-term capital gain for federal income tax
purposes and subject to the same tax rates and holding periods that apply to
Shares acquired upon exercise of a Non-Qualified Stock Option. If Shares
purchased under an Incentive Stock Option are disposed of within such one-year
or two-year periods, any gain realized on such disposition will be treated as
compensation income (taxable at ordinary income rates) to the extent of the
difference between the Exercise Price and the lesser of (i) the Fair Market
Value of the Shares on the date of exercise, or (ii) the sale price of the
Shares.
11. ENTIRE AGREEMENT: GOVERNING LAW. The Notice, the Plan and this Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and the Optionee with respect to the subject
matter hereof, and may not be modified adversely to the Optionee's interest
except by means of a writing signed by the Company and Optionee. IN THAT
REGARD, THIS AGREEMENT OPTION FULLY SATISFIES THE OBLIGATION OF THE COMPANY
TO GRANT OPTIONEE THE OPTIONS DESCRIBED IN THE COMPANY'S OFFER LETTER TO
OPTIONEE PRIOR TO OPTIONEE'S BECOMING AN EMPLOYEE OR CONSULTANT OF THE
COMPANY, AND, IN THE EVENT OF ANY CONFLICT BETWEEN THE OPTION DESCRIBED IN
SUCH OFFER LETTER OR AGREEMENT AND THIS OPTION AGREEMENT, THE TERMS AND
CONDITIONS OF THIS OPTION AGREEMENT SHALL CONTROL. These agreements are
governed by California law except for that body of law pertaining to conflict
of laws.
12. HEADINGS. The captions used in the Notice and this Option Agreement are
inserted for convenience and shall not be deemed a part of the Option for
construction or interpretation.
13. INTERPRETATION. Any dispute regarding the interpretation of the Notice,
the Plan, and this Option Agreement shall be submitted by the Optionee or by
the Company forthwith to the Board or the Administrator that administers the
Plan, which shall review such dispute at its next regular meeting. The
resolution of such dispute by the Board or the Administrator shall be final
and binding on all persons.
14. FURTHER ASSURANCES. Optionee shall execute such further instruments and
take such further actions as may be requested BY the Company as reasonably
necessary to carry out the intent and purposes of this Option Agreement.
15. SUCCESSORS AND ASSIGNS. The Company may assign any of its rights under
this Option Agreement to single or multiple assignees, and this Option
Agreement shall inure to the benefit of the successors and assigns of the
Company. Subject to the restrictions on transfer herein set forth, this
Agreement shall be binding upon Optionee and his or her heirs, executors,
administrators, successors and assigns.
4
16. NOTICES. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States mail by certified mail, with postage and fees
prepaid, addressed to the Company at its primary business office and to
Optionee at its address as shown below beneath its signature, or to such
other address as such party may designate in writing from time to time to the
other party.
5
EXHIBIT A
XOOM.COM, INC. 1998 STOCK INCENTIVE PLAN
EXERCISE NOTICE
XOOM.com, Inc.
300 Montgomery Street, Suite 300
San Francisco, CA 94104
Attention: Secretary
1. EXERCISE OF OPTION. Effective as of today, ________ __, ____, the undersigned
(the 'Optionee') hereby elects to exercise the Optionee's option to purchase
shares of the Common Stock (the 'Shares') of XOOM.com, Inc. (the 'Company')
under and pursuant to the Company's 1998 Stock Incentive Plan (the 'Plan') and
the [ ] Incentive [ ] Non-Qualified Stock Option Agreement and the within Notice
of Stock Option Grant. The Optionee herewith delivers to the Company the full
Exercise Price for the Shares.
Total Number of Option Shares to Exercise (A):
---------------------------------
Exercise Price per Share (B): $
-----------------------------------------------
Total Amount to be Tendered (A x B): $
-----------------------------------------
2. REPRESENTATIONS OF THE OPTIONEE. The Optionee acknowledges that the Optionee
has received, read and understood the Notice of Stock Option Grant, the Plan and
the Option Agreement and agrees to abide by and be bound by their terms and
conditions.
3. RIGHTS AS STOCKHOLDER. Until the stock certificate evidencing such Shares is
issued (as evidenced by the appropriate entry on the books of the Company or of
a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to the
Shares, notwithstanding the exercise of the Option.
4. TAX CONSULTATION. The Optionee understands that the Optionee may suffer
adverse tax consequences as a result of the Optionee's purchase or disposition
of the Shares. The Optionee represents that the Optionee has consulted with any
tax consultants the Optionee deems advisable in connection with the purchase or
disposition of the Shares and that the Optionee is not relying on the Company
for any tax advice.
5. TAXES. The Optionee agrees to satisfy all applicable federal, state and local
income and employment tax withholding obligations and herewith delivers to the
Company the full amount of such obligations or has made arrangements acceptable
to the Company to satisfy such obligations. In the case of an Incentive Stock
Option, the Optionee also agrees, as partial consideration for the designation
of the Option as an Incentive Stock Option, to notify the
A-1
Company in writing within thirty (30) days of any disposition of any shares
acquired by exercise of the Option if such disposition occurs within two (2)
years from the Grant Date or within one (1) year from the date the Shares were
transferred to the Optionee. If the Company is required to satisfy any federal,
state or local income or employment tax withholding obligations as a result of
such an early disposition, the Optionee agrees to satisfy the amount of such
withholding in a manner that the Administrator prescribes.
Submitted by: Accepted by:
OPTIONEE: XOOM.com, Inc.
By:
------------------------------------
Its:
------------------------- ------------------------------------
(Signature)
ADDRESS: ADDRESS:
-------- --------
------------------------
------------------------
A-2
1998 Stock Incentive Plan - Xoom Inc.
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