Rosetta Stone 2011 Annual Report Download - page 211

more instances, shall be construed as a continuing waiver of any such condition or breach, a waiver of any other condition, or the
breach of any other term or condition.
15. Dispute Resolution. In the event of any difference of opinion concerning the meaning or effect of the Plan or this
Agreement, such difference shall be resolved by the Committee.
16. Governing Law and Severability. The validity, construction and performance of this Agreement shall be governed by
the laws of the State of Delaware, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or
interpretation of this Agreement to the substantive law of another jurisdiction. The invalidity of any provision of this Agreement shall
not affect any other provision of this Agreement, which shall remain in full force and effect.
17. Transfer Restrictions. The Option Shares may not be sold or otherwise disposed of in any manner that would
constitute a violation of any applicable federal or state securities laws. Optionee also agrees (a) that the Company may refuse to cause
the transfer of Option Shares to be registered on the applicable stock transfer records if such proposed transfer would in the opinion of
counsel satisfactory to the Company constitute a violation of any applicable securities law and (b) that the Company may give related
instructions to the transfer agent, if any, to stop registration of the transfer of the Option Shares.
18. Successors and Assigns. This Agreement shall, except as herein stated to the contrary, inure to the benefit of and
bind the legal representatives, successors and assigns of the parties hereto.
19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original for
all purposes but all of which taken together shall constitute but one and the same instrument.
20. Option Transfer Prohibitions. The Option granted to Optionee under this Agreement shall not be transferable or
assignable by Optionee other than by will or the laws of descent and distribution, and shall be exercisable during Optionee's lifetime
only by him.
21. Definitions. The words and phrases defined in this Section 21 shall have the respective meanings set forth below
throughout this Agreement, unless the context in which any such word or phrase appears reasonably requires a broader, narrower or
different meaning.
(a) "Cause" shall mean Optionee (i) committed a felony or a crime involving moral turpitude or committed
any other act or omission involving fraud, embezzlement or any other act of dishonesty in the course of his employment by the
Company or an Affiliate which conduct damaged the Company or an Affiliate; (ii) substantially and repeatedly failed to perform
duties of the office held by him or her as reasonably directed by the Company or an Affiliate; (iii) committed gross negligence or
willful misconduct with respect to the Company or an Affiliate; (iv) committed a material breach of any employment agreement
between the Optionee and the Company or an Affiliate that is not cured within ten (10) days after receipt of written notice thereof
from the Company or the Affiliate, as applicable; (v) failed, within ten (10) days after receipt by the Optionee of written notice thereof
from the Company or an Affiliate, to
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