EXHIBIT 99.3
FORM OF NETZERO, INC. STOCK OPTION ASSUMPTION AGREEMENT
NETZERO, INC.
STOCK OPTION ASSUMPTION AGREEMENT
UNDER
AIMTV, INC. (FORMERLY XXXXXXXXX.XXX, INC.)
1999 STOCK OPTION PLAN
OPTIONEE: < < Employee > >,
STOCK OPTION ASSUMPTION AGREEMENT effective as of the [___] day of
December, 1999.
WHEREAS, the undersigned individual ("Optionee") holds one or more
outstanding options to purchase shares of the common stock of AimTV, Inc., a
California corporation ("AIM"), which were granted to Optionee under the AimTV,
Inc. (formerly XxxxXxxxx.xxx, Inc.) 1999 Stock Option Plan (the "Plan").
WHEREAS, each of those options are evidenced by a Stock Option
Agreement (the "Option Agreement") issued to the Optionee under such Plan.
WHEREAS, AIM has been acquired by NetZero, Inc., a Delaware corporation
("NetZero"), through the merger of AIM with and into NetZero (the "Merger")
pursuant to the Agreement and Plan of Reorganization by and between NetZero and
AIM (the "Merger Agreement").
WHEREAS, the provisions of the Merger Agreement require AIM's
obligations under each outstanding option under the Plan to be assumed by
NetZero at the consummation of the Merger and the holder of each such
outstanding option to be issued an agreement evidencing the assumption of that
options.
WHEREAS, pursuant to the provisions of the Merger Agreement, the
exchange ratio (the "Exchange Ratio") in effect for the Merger is 0.048484
shares of NetZero common stock ("NetZero Stock") for each outstanding share
of AIM common stock ("AIM Stock").
WHEREAS, the purpose of this Agreement to evidence the assumption by
NetZero of the outstanding options held by Optionee under the Plan at the
consummation of the Merger (the "Effective Time") and to reflect certain
adjustments to those options which have become necessary in connection with
their assumption by NetZero in the Merger.
NOW, THEREFORE, it is hereby agreed as follows:
1. The number of shares of AIM Stock subject to the options held by
Optionee immediately prior to the Effective Time (the "AIM Options") and the
exercise price payable per share in effect for those options are set forth
below. NetZero hereby assumes, as of the Effective Time, all the duties and
obligations of AIM under each of the AIM Options. In
connection with such assumption, the number of shares of NetZero Stock
purchasable under each AIM Option hereby assumed and the exercise price payable
thereunder have been adjusted to reflect the Exchange Ratio. Accordingly, the
number of shares of NetZero Stock subject to each AIM Option hereby assumed
shall be as specified for that option below, and the adjusted exercise price
payable per share of NetZero Stock under the assumed AIM Option shall also be as
indicated for that option below.
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AIM STOCK OPTIONS NETZERO ASSUMED OPTIONS
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# of Shares of AIM Common Exercise Price # of Shares of NetZero Adjusted Exercise
Stock per Share Common Stock Price per Share
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$ $
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2. The intent of the foregoing adjustments to each assumed AIM Option
is to assure that the spread between the aggregate fair market value of the
shares of NetZero Stock purchasable under each such option and the aggregate
exercise price as adjusted pursuant to this Agreement will, immediately after
the consummation of the Merger, be not less than the spread which existed,
immediately prior to the Merger, between the then aggregate fair market value of
the AIM Stock subject to the AIM Option and the aggregate exercise price in
effect at such time under the Option Agreement. Such adjustments are also
intended to preserve, immediately after the Merger, on a per share basis, the
same ratio of the exercise price per option share to the fair market value per
share which existed under the AIM Option immediately prior to the Merger.
3. The following provisions shall govern each AIM Option hereby assumed
by NetZero:
(a) Unless the context otherwise requires, all references in each
Option Agreement hereby assumed by NetZero and in the Plan (to the extent
incorporated into such Option Agreement) shall be adjusted as follows: (i)
all references to the "Company" shall mean NetZero, (ii) all references to
"Shares" or shares of "Common Stock" shall mean shares of NetZero Stock,
(iii) all references to the "Board" shall mean the Board of Directors of
NetZero and (iv) all references to the "Committee" or "Administrator" shall
mean the Compensation Committee of the NetZero Board of Directors.
(b) The grant date and the expiration date of each assumed AIM
Option and all other provisions which govern either the exercise or the
termination of the assumed AIM Option shall remain the same as set forth in
the Option Agreement applicable to that option, and the provisions of the
Option Agreement shall accordingly govern and control Optionee's rights
under this Agreement to purchase NetZero Stock.
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(c) Pursuant to the terms of the Option Agreement, none of the
assumed AIM Options shall vest or become exercisable on an accelerated
basis upon the consummation of the Merger. Accordingly, each AIM Option
assumed by NetZero shall continue to vest and become exercisable for any
remaining unvested shares of NetZero Stock subject to that option in
accordance with the same installment vesting schedule in effect under the
applicable Option Agreement immediately prior to the Effective Time;
PROVIDED, however, that the number of shares subject to each such
installment shall be adjusted to reflect the Exchange Ratio.
(d) For purposes of applying any and all provisions of the Option
Agreement and/or the Plan relating to Optionee's status as an employee or a
consultant of AIM, Optionee shall be deemed to continue in such employee or
a consultant status for so long as Optionee renders services to NetZero (or
any present or future NetZero parent or subsidiary corporation) as an
employee or a consultant. Accordingly, the provisions of the Option
Agreement governing the termination of the assumed AIM Options upon
Optionee's cessation of employee or consultant status shall hereafter be
applied on the basis of Optionee's cessation of employee or consultant
status with NetZero and its parent or subsidiary corporations, and each
assumed AIM Option shall accordingly terminate, within the designated time
period in effect under the Option Agreement for that option, following such
cessation of employee or a consultant status.
(e) The adjusted exercise price payable for the NetZero Stock
subject to each assumed AIM Option shall be payable in any of the forms
authorized under the Option Agreement applicable to that option. For
purposes of determining the holding period of any shares of NetZero Stock
delivered in payment of such adjusted exercise price, the period for which
such shares were held as AIM Stock prior to the Merger shall be taken into
account.
(f) In order to exercise each assumed AIM Option, Optionee must
deliver to NetZero a written notice of exercise in which the number of
shares of NetZero Stock to be purchased thereunder must be indicated. The
exercise notice must be accompanied by payment of the adjusted exercise
price payable for the purchased shares of NetZero Stock and should be
delivered to NetZero at the following address:
NetZero, Inc.
0000 Xxxxxxxxx Xxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Corporate Secretary
4. Except to the extent specifically modified by this Option Assumption
Agreement, all of the terms and conditions of each Option Agreement as in effect
immediately prior to the Merger shall continue in full force and effect and
shall not in any way be amended, revised or otherwise affected by this Stock
Option Assumption Agreement.
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IN WITNESS WHEREOF, NetZero, Inc. has caused this Stock Option
Assumption Agreement to be executed on its behalf by its duly-authorized officer
as of the [___] day of December, 1999.
NETZERO, INC.
By:
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Title:
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ACKNOWLEDGMENT
The undersigned acknowledges receipt of the foregoing Stock Option
Assumption Agreement and understands that all rights and liabilities with
respect to each of his or her AIM Options hereby assumed by NetZero are as
set forth in the Option Agreement, the Plan (to the extent incorporated in
such Option Agreement ) and such Stock Option Assumption Agreement.
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OPTIONEE
DATED: __________________, _____
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