1
4 YEAR VESTING
HIGHWAYMASTER COMMUNICATIONS, INC.
STOCK OPTION AGREEMENT
This OPTION AGREEMENT is entered into by and between HighwayMaster
Communications, Inc., a Delaware corporation (the "Company"), and the
undersigned employee of the Company's subsidiary, HighwayMaster Corporation,
(the "Optionee").
1. Grant of Option. The Company hereby grants to the Optionee effective
as of the date set forth in Section 18 hereof (the "Date of Grant"), the right
and option (the "Option") to purchase up to the aggregate number of shares of
common stock, par value $.01 per share, of the Company (the "Common Stock") set
forth in Section 18 hereof, subject to adjustment pursuant to Section 3 hereof
and subject to the Optionee's acceptance and agreement to all of the terms and
conditions and restrictions described in the HighwayMaster Communications, Inc.
(formerly known as HM Holding Corporation) 1994 Stock Option Plan, as amended
(the "Plan"), a copy of which has been provided to the Optionee, and to the
further terms, conditions and restrictions set forth below.
2. Exercise Price. Subject to adjustment pursuant to Section 3, the
exercise price payable by the Optionee upon exercise of this Option is set forth
in Section 18 hereof.
3. Adjustments to Number of Shares and Option Price. The number of shares
of Common Stock exercisable under this Option and exercise price have been
adjusted to give effect to the purchase under that certain Subscription
Agreement dated February 4, 1994, by and among the Company and the Purchasers
listed therein by such Purchasers of an aggregate of 2,130.435 shares of Common
Stock of the Company. The number of shares and exercise price shall also be
adjusted as provided in Section 9.3 of the Plan.
2
4. Tax Status. This Option will be treated as an "incentive stock option"
within the meaning of Section 422 of the Code to the extent that any portion of
this Option meets the requirements of Section 422 of the Code. To the extent
that any portion of this Option does not meet such Code requirements, this
Option shall be deemed a nonqualified stock option.
5. Exercise of Option. Subject to the terms of the Plan and this Option
Agreement, as of the Date of Grant and each of the first, second, third and
fourth anniversaries of the Date of Grant, Optionee may exercise (cumulatively)
rights to acquire one-fifth of the Common Stock subject to the Option.
6. Expiration of Option. This Option shall expire and cease to be
exercisable on the sixth anniversary of the Date of Grant or such earlier date
as may be specified in the Plan.
7. Termination of Affiliation.
(a) Subject to the following provisions of this Section 7 and Article
VI of the Plan, this Option may not be exercised unless at the time of
exercise the Optionee is an Employee of the Company or a Subsidiary.
(b) If the Optionee's position as an Employee of the Company or a
Subsidiary shall terminate for any reason other than death, the Optionee
may exercise this Option, to the same extent it was exercisable on the date
of such termination, during the 60-day period following the date of such
termination. In no event may the Optionee exercise this Option later than
the date on which the Option would have expired under Section 6 hereof.
(c) If the Optionee's position as an Employee of the Company or a
Subsidiary shall terminate by reason of the Optionee's death, the executor
or administrator of the Optionee's estate or the person to whom this Option
is transferred by will or the laws of descent or distribution may exercise
this Option with respect to any or all shares covered by this Option within
60 days after the date of the Optionee's death.
2
3
8. Procedure to Exercise. This Option may be exercised only by delivery
of a written notice to the Company at its principal office, stating the number
of shares of Common Stock as to which the Option is being exercised and
accompanied by payment in full in cash or by certified check of the exercise
price for all such shares.
9. Nontransferability of Option. This Option shall not be assignable or
transferable other than by will or the laws of descent and distribution and
shall be exercisable only by the Optionee during his lifetime.
10. Continued Employment or Retention. Subject to the terms of any
employment agreement between the Company and the Optionee, nothing herein shall
confer upon the Optionee any right to be continued in the employ or retention of
the Company or a Subsidiary or shall prevent the Company or Subsidiary which
employs or retains the Optionee from terminating such employment at any time,
with or without cause.
11. Rights as Shareholder. Nothing herein is intended to or shall give to
the Optionee any right or status of any kind as a stockholder of the Company in
respect of any shares of Common Stock covered by this Option or entitle the
Optionee to any dividends or distributions thereon unless and until such shares
shall have been delivered to the Optionee and registered in the Optionee's name.
12. Interpretation. If and when questions arise from time to time as to
the intent, meaning or application of the provisions hereof or of the Plan, such
questions shall be decided by the Board of Directors or the Committee in its
sole discretion, and any such decision shall be conclusive and binding on the
Optionee. The Optionee hereby agrees that this Option is granted and accepted
subject to such condition and understanding.
13. Investment Representation. At such time or times as the Optionee may
exercise this Option, the Optionee shall, upon the request of the Company,
represent in writing (i) that the shares
3
4
being acquired by the Optionee will not be sold except pursuant to an effective
registration statement, or applicable exemption from registration, under the
Securities Act of 1933, as amended, (ii) that it is the Optionee's intention to
acquire the shares being acquired for investment only and not with a view to
distribution thereof, and (iii) other customary representations as the Company
deems necessary or advisable. No shares will be issued unless and until the
Company is satisfied as to the accuracy of such representations.
14. Withholding of Taxes. Upon exercise of this Option (either wholly or
in part), the Optionee must pay to the Company, or make arrangements
satisfactory to the Company regarding payment of, any federal, state or local
taxes of any kind required to be withheld in connection with the issuance to the
Optionee of Common Stock upon exercise of this Option.
15. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered personally,
mailed certified mail (return receipt requested) or sent by overnight delivery
service, cable, telegram, facsimile transmission or telex to the Optionee at the
address on the signature page hereof and to the Company at the address set forth
below or at such other addresses as shall be specified by the parties by like
notice:
HighwayMaster Communications, Inc.
0000 Xxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
Fax: (000)000-0000
Attn: Secretary & General Counsel
16. Defined Terms. All capitalized terms used herein and not otherwise
defined shall have the meanings given them in the Plan.
17. Confidentiality. Unless otherwise permitted by the Chairman of the
Board or the President of the Company, Optionee agrees to keep confidential the
terms of this Option Agreement (and the terms of any other Option Agreement with
any other employee of the Company known to Optionee) and shall not disclose such
terms to any other employee or otherwise.
4
5
18. Specified Information. This Option Agreement shall apply with respect
to the following specific information:
a. Date of Grant: JUNE 24, 1999
b. Name of Optionee: J. XXXXXXX XXXXXX
c. Adjusted Number of Shares Covered by Option: 25,000
d. Option Exercise Price Per Share: $1.41
IN WITNESS WHEREOF, the undersigned have executed this Option Agreement to
be effective as of the Date of Grant set forth above.
HIGHWAYMASTER COMMUNICATIONS, INC.
By: /s/ XXXX XXXX
-----------------------------------
Name: Xxxx Xxxx
---------------------------------
Title: President and CEO
--------------------------------
/s/ J. XXXXXXX XXXXXX
--------------------------------------
J. XXXXXXX XXXXXX, Optionee
5
