Document/Exhibit Description Pages Size
1: 10-Q Network Solutions Form 10-Q 32 177K
2: EX-3 Certificate of Amendment 2 10K
3: EX-10.27 Amendment #14 to the Cooperative Agrmt. of July 13 2 14K
4: EX-10.28 Amendment #15 to the Cooperative Agrmt. of July 16 2 14K
5: EX-10.29 Offer Letter Between James Rutt and Network 5 25K
6: EX-10.30 Separation Agrmt. Between James Rutt & Network 7 29K
7: EX-10.31 Non-Statutory Stock Option Agreement Dated June 7 7 39K
8: EX-10.32 Non-Statutory Stock Option Agreement Dated May 21 7 39K
9: EX-27.1 FDS for Period Ending June 30, 1999 1 7K
10: EX-27.2 FDS for Period Ending June 30, 1998 1 9K
EX-10.32 — Non-Statutory Stock Option Agreement Dated May 21
Exhibit Table of Contents
NETWORK SOLUTIONS, INC.
1996 STOCK INCENTIVE PLAN
NONSTATUTORY STOCK OPTION AGREEMENT
Network Solutions, Inc., a Delaware corporation (the "Company"),
hereby grants an Option to purchase shares of its Class A Common Stock ("Common
Shares") to the Optionee named below. The terms and conditions of the Option are
set forth in this cover sheet, in the attached Agreement and in the Company's
1996 Stock Incentive Plan (the "Plan"), as amended and restated effective July
7, 1997.
Date of Grant: 5/21/99
------------------------------------------------------------
Name of Optionee: James Rutt
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Optionee's Social Security Number: 212-66-9992
-----------------------------------------
Number of Common Shares Covered by Option: 375,000
---------------------------------
Exercise Price per Common Share: $64.00
-------------------------------------------
Vesting Start Date: 5/21/99
--------------------------------------------------------
Vesting Schedule: Subject to the attached Agreement, during your Service the
Option shall vest as to 30%, 30%, 20% and 20% of the Common Shares on the first
through fourth anniversaries, respectively, of the Vesting Start Date. In the
event your employment terminates due to death or disability, you will receive
pro rata vesting credit for each whole month of Service you complete. (For
example, the Option will be 15% vested if your employment terminates due to
disability 6 months after the Vesting Start Date.) Also, in the event your
employment is involuntarily terminated other than for Cause or Non-performance,
or you voluntarily terminate your employment for Good Reason, at the time of
termination you will be credited with an additional twelve (12) months of
Service for purposes of the Vesting Schedule. (For example, the Option will be
30% vested if your employment is terminated by the Company other than for Cause
or Non-performance or if you terminate your employment for Good Reason, before
the first anniversary of the Vesting Start Date. In addition to the additional
twelve (12) months of Service credited above, if applicable, in the event your
employment is involuntarily terminated other than for Cause or Non-performance,
or you voluntarily terminate your employment for Good Reason, in each case,
either immediately before or within eighteen months after a Change of Control
occurs, at the time of termination you will be credited with an additional
twelve (12) months of Service for purposes of the Vesting Schedule; provided,
however, that for this purpose, "Good Reason" shall not exist solely if, as a
result of the Change of Control, you become responsible for managing a company,
subsidiary or division which is engaged in substantially the same business as
the Company was engaged in immediately prior to the Change of Control. For
purposes of this Option, the term "Change in Control" shall mean (i) a Change in
Control as defined in the Plan, or (ii) approval by the stockholders of the
Company of a reorganization, merger, consolidation, in each case, with respect
to which persons who were stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more
than 50% of the combined voting power entitled to vote generally in the election
of directors of the reorganized, merged or consolidated company's then
outstanding voting securities, or a liquidation or dissolution of the Company or
of the sale of all or substantially all of the assets of the Company.
BY SIGNING THIS COVER SHEET, YOU VOLUNTARILY AGREE TO ALL OF THE
TERMS AND CONDITIONS DESCRIBED IN THE ATTACHED AGREEMENT AND IN THE
PLAN, A COPY OF WHICH IS ALSO ATTACHED.
Optionee: /s/ JAMES P. RUTT
---------------------------------------------------------------------
(Signature)
Company: /s/ ROBERT J. KORZENIEWSKI
---------------------------------------------------------------------
(Signature)
Title: CFO
-------------------------------------------------------------
2
NETWORK SOLUTIONS, INC.
1996 STOCK INCENTIVE PLAN
NONSTATUTORY STOCK OPTION AGREEMENT
NONSTATUTORY STOCK This Option is not intended to be an
OPTION incentive stock option under section
422 of the Internal Revenue Code and
will be interpreted accordingly.
VESTING Your right to exercise this Option
vests during your Service as shown on
the cover sheet. The number of vested
Common Shares shall be rounded to the
next lower whole number. No
additional Common Shares will vest
after your Service has terminated for
any reason, except as provided
herein.
For purposes of this Option, the term
"Cause" shall mean (i) your
conviction of a felony involving a
personal act of willful and
intentional misconduct or the entry
by you of a plea of nolo contendere
in connection with such an alleged
felony.
For purposes of this Option, the term
"Non-performance" shall mean (i) the
repeated and continual failure by you
to fulfill the basic duties of your
positions(s) with the Company; (ii)
your gross negligence, dishonesty,
willful malfeasance or gross
misconduct in connection with your
employment with the Company which has
had (or is expected to have) a
demonstrative and adverse effect on
the business or reputation of the
Company or its subsidiaries; or (iii)
failure by you to follow any lawful
directive established for you by the
Board of Directors. Notwithstanding,
the foregoing, "Non-performance"
shall not be deemed to exist unless
you have been given an opportunity to
be heard by the Board of Directors
after at least 10 days' written
notice by the Board. In addition, for
purposes of the definition of
"Non-performance," any isolated,
insubstantial and inadvertent action
not taken in bad faith which is
remedied by you promptly after
receipt of written notice thereof
from the Company shall not be deemed
to be "Non-performance."
For purposes of this Option, the term
"Good Reason" shall mean the
occurrence of any of the following
without your written consent: (i)
assignment to you of any duties
materially inconsistent with your
position as Chief Executive Officer
or any material diminution in your
position, authority, duties or
responsibilities; (ii) reduction in
base salary or target bonus
opportunity or failure to provide you
with stock option grants on a basis
which is at least as favorable as
that provided to other executive
officers generally (excluding grants
to new hires or other extraordinary
grants to a particular individual);
(iii) relocation of your principal
work place to a location that is more
3
than 25 miles from Reston, Virginia;
or (iv) failure to be elected or
reelected to the NSI Board of
Directors or removal from the NSI
Board of Directors. For purposes of
the definition of "Good Reason," any
isolated, insubstantial and
inadvertent action not taken in bad
faith which is remedied by NSI
promptly after receipt of written
notice thereof from you shall not be
deemed to be "Good Reason."
This Option shall not be reduced as
provided in, or be subject to,
Article 14 of the Plan.
SERVICE Your "Service" continues while you
are actively employed by, or serving
as a consultant to or director of,
the Company or any Parent, Subsidiary
or other affiliate of the Company
determined in the sole discretion of
the Company. For purposes of this
Option, your Service does not
terminate when you go on a bona fide
leave of absence that was approved by
the Company in writing, if the terms
of the leave provide for continued
Service crediting, or when continued
Service crediting is required by
applicable law. Your Service
terminates in any event when the
approved leave ends, unless you
immediately return to active work.
The Company determines which leaves
shall be credited toward Service, and
when your Service terminates, for all
purposes under the Plan and
this Agreement.
TERM Your Option will expire in any event
at the close of business at Company
headquarters on the day before the
fifth anniversary of the date of
grant of the terminated Option. (It
will expire earlier if your Service
terminates, as described below.)
IMPORTANT: If a properly executed
"Notice of Exercise" form, together
with payment for the exercise price
and tax withholding, are not received
by the Company prior to the
expiration of the term of this
Option, all rights to acquire Common
Shares under this Agreement will be
forfeited.
REGULAR TERMINATION If your Service terminates for any
reason except death or Disability,
your Option will expire at the close
of business at Company headquarters
on the 90th day after your
termination date. During such 90-day
period, you may exercise that
portion of your Option that was
vested on your Service termination
date.
DEATH If you die while in Service, your
Option will expire at the close of
business at Company headquarters on
the date 12 months after the date of
death. During that 12-month period,
your beneficiary, estate or heirs may
exercise that portion of your Option
that was vested on your date of
death.
DISABILITY If your Service terminates because of
your Disability, your Option will
expire at the close of business at
Company headquarters on the date 12
months after your Service termination
date. During such 12-
4
month period, you or your legal
guardian may exercise that portion
of your Option that was vested on
your date of Disability.
"Disability" means that you are
unable to engage in any substantial
gainful activity by reason of any
medically determinable physical or
mental impairment which can be
expected to result in death or which
has lasted or can be expected to last
for a continuous period of not less
than 12 months, as determined
pursuant to Section 22(e)(3) of the
Internal Revenue Code of 1986, as
amended.
NOTICE OF EXERCISE When you wish to exercise this
Option, you must notify the Committee
by filing the proper "Notice of
Exercise" form at the address given
on the form together with payment of
the Exercise Price and any required
tax withholding, as described below.
Your Notice of Exercise must specify
how many Common Shares you wish to
purchase and how your Common Shares
should be registered (in your name
only, in your and your spouse's names
as community property or as joint
tenants with right of survivorship or
in a trust for your benefit, or in
the name of a brokerage firm for your
account as designated by you). The
Notice of Exercise will be effective
when it is received by the Committee.
If someone else wants to exercise
this Option after your death, or
Disability, that person must prove
to the Committee's satisfaction that
he or she is entitled to do so.
FORM OF PAYMENT When you submit your Notice of
Exercise, you must include payment of
the Exercise Price for the Common
Shares you are purchasing. Payment
may be made in one (or a combination)
of the following forms:
- Your personal check, a cashier's
check or a money order.
- Common Shares which have already
been owned by you for more than
six months and which are
surrendered to the Company. The
value of the Common Shares,
determined as of the effective
date of the Option exercise, will
be applied to the Exercise Price
and tax withholding obligations.
- By delivery (on a form prescribed
by the Committee) of an
irrevocable direction to a
securities broker to sell Common
Shares and to deliver all or part
of the sale proceeds to the
Company in payment of the
aggregate Exercise Price and tax
withholding obligations.
- By the delivery (on a form
prescribed by the Company) of an
irrevocable direction to pledge
Common Shares to a securities
broker or lender approved by the
Company, as security for a loan,
and to deliver all or part of the
loan proceeds to the Company in
payment of all or part of the
Exercise Price and any
withholding
5
taxes.
WITHHOLDING TAXES You will not be allowed to
exercise this Option unless you make
acceptable arrangements to pay any
withholding or other taxes that may
be due as a result of the option
exercise or the sale of Common Shares
acquired upon exercise of this
Option.
RESTRICTIONS By signing this Agreement, you agree
ON EXERCISE not to sell any Common Shares at a
AND RESALE time when prohibited by applicable
laws, regulations or Company or
underwriter trading policies. In
connection with any underwritten
public offering by the Company of its
equity securities pursuant to an
effective registration statement
filed under the Securities Act, you
agree not to sell, make any short
sale of, loan, hypothecate, pledge,
grant any option for the purchase of,
or otherwise dispose or transfer for
value or agree to engage in any of
the foregoing transactions with
respect to any Common Shares without
the prior written consent of the
Company or its underwriters, for such
period of time after the effective
date of such registration statement
as may be requested by the Company or
such underwriters.
In order to enforce the provisions of
this paragraph, the Company may
impose stop-transfer instructions
with respect to the Common Shares.
In the event that the sale of Common
Shares under the Plan is not
registered under the Securities Act
but an exemption is available that
requires an investment representation
or other representation, you shall
represent and agree at the time of
exercise that the Common Shares
being acquired upon exercising this
Option are being acquired for
investment, and not with a view to
the sale or distribution thereof,
and shall make such other
representations as are deemed
necessary or appropriate by the
Company and its counsel.
TRANSFER OF OPTION Prior to your death, only you or, in
the event of your Disability, your
legal guardian, may exercise this
Option. You cannot transfer or assign
this Option. For instance, you may
not sell this Option or use it as
security for a loan. If you attempt
to do any of these things, this
Option will immediately become
invalid. You may, however, dispose of
this Option by beneficiary
designation or in your will.
Regardless of any marital property
settlement agreement, the Company is
not obligated to honor a Notice of
Exercise from your spouse or former
spouse, nor is the Company obligated
to recognize such individual's
interest in your Option in any other
way.
RETENTION RIGHTS This Agreement does not give you the
right to be retained by the Company
in any capacity. The Company
reserves the right to terminate your
Service at any time and for any
reason.
6
STOCKHOLDERS RIGHTS You, or your estate or heirs, have no
rights as a stockholder of the
Company until a certificate for the
Common Shares acquired upon exercise
of this Option has been issued. No
adjustments are made for dividends or
other rights if the applicable record
date occurs before your stock
certificate is issued, except as
described in the Plan.
ADJUSTMENTS In the event of a stock split, a
stock dividend or a similar change in
the Common Shares, the number of
Common Shares covered by this Option
and the Exercise Price per share may
be adjusted pursuant to the Plan.
Your Option shall be subject to the
terms of the agreement of merger,
liquidation or reorganization in the
event the Company is subject to such
corporate activity.
LEGENDS All certificates representing the
Common Shares issued upon exercise
of this Option shall have endorsed
thereon any legends required by
applicable law.
APPLICABLE LAW This Agreement will be interpreted
and enforced under the laws of the
State of Delaware (without regard to
their choice of law provisions).
THE PLAN AND The text of the Plan is incorporated
OTHER AGREEMENTS in this Agreement by reference.
Certain capitalized terms used in
this Agreement are defined in the
Plan.
This Agreement and the Plan
constitute the entire understanding
between you and the Company
regarding this Option. Any prior
agreements, commitments or
negotiations concerning this Option
are superseded.
BY SIGNING THE COVER SHEET OF THIS AGREEMENT, YOU AGREE TO ALL OF THE TERMS AND
CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.
7
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 8/16/99 | | | | | | | None on these Dates |
| For Period End: | | 6/30/99 |
| | 7/7/97 | | 1 |
| List all Filings |
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