Rosetta Stone 2014 Annual Report Download - page 104

ROSETTA STONE INC.
2009 OMNIBUS INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AWARD AGREEMENT
This NONQUALIFIED STOCK OPTION AWARD AGREEMENT (this “Agreement”) and the Cover Sheet to which
this Agreement is attached (the “Cover Sheet”) are entered into between Rosetta Stone Inc., a Delaware corporation (the “Company”),
and Optionee (as that term is defined in the Covered Sheet). The Board of Directors of the Company has adopted, and the stockholders
of the Company have approved, the Rosetta Stone Inc. 2009 Omnibus Incentive Plan (the “Plan”), the terms of which are incorporated
by reference herein in their entirety. Any term used in this Agreement that is not specifically defined herein shall have the meaning
specified in the Plan.
IT IS AGREED:
1. . Subject to the terms of the Plan, this Agreement and the Cover Sheet, on the Grant Date set forth on
the Cover Sheet (the “Grant Date”), the Company granted to Optionee an option (the “Option”) to purchase that number of shares of
the Company’s common stock, $.00005 par value (the “Stock”), at the Option Price per Share of Stock set forth on the Cover Sheet
(the “Option Price”), subject to adjustment as provided in the Plan.
2. . The Option is a nonqualified stock option which is not intended to be governed by section 422 of the
Code and will be interpreted accordingly.
3. . In accepting the Option, Optionee accepts and agrees to be bound by all the terms and
conditions of the Plan which pertain to nonqualified stock options granted under the Plan.
4.    . Subject to the provisions of the Plan and the provision of this Agreement (including the
requirement in Section 6 that Optionee continue to be employed by the Company or a Subsidiary Corporation on the dates set forth
below), the Option will vest and become exercisable in accordance with the following terms:
(a) on the first anniversary of the Vesting Start Date (as set forth on the Cover Sheet), and on each succeeding
anniversary date of the Vesting Start Date, the Option will vest with respect to, and may be exercised for up to, one-fourth (1/4th) of the
total number of shares of the Stock subject to the Option as set forth on the Cover Sheet (the “Option Shares”), rounded to the nearest
whole number of shares, except that on the fourth anniversary of the Vesting Start Date the Option shall vest with respect to the
remaining number of Option Shares for which the Option has not previously vested;
(b) upon the occurrence of a Change in Control, any portion of the Option Shares that have not previously vested
will vest and the Option shall be exercisable in full upon the occurrence of such Change in Control; and
(c) to the extent not exercised, installments of vested Option Shares shall be cumulative and may be exercised in
whole or in part.
5. .
(a) To the extent that the Option is vested and exercisable in accordance with Section 4 of this Agreement, the
Option may be exercised by Optionee at any time, or from time to time, in whole or in part, on or prior to the termination of the Option
(as set forth in Section 6 of this Agreement) upon payment