Rosetta Stone 2014 Annual Report Download - page 110

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. Grant of Option. 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. Type of Option. 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. Optionee’s Agreement. 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. Vesting of Option . Subject to the provisions of the Plan and the provision of this Agreement (including the
requirement in Section 6 that Optionee continue to serve as a member of the Board on the dates set forth below), the Option will be
exercisable in accordance with the following schedule:
(a) on the last day of the three-month period beginning on the Vesting Start Date (as set forth on the Cover
Sheet), and on the last day of each succeeding three-month period, 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 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 day before the first 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) if Optionee has served as a member of the Board for two (2) or more years at the time of the occurrence of a
Change in Control, then 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 shall be cumulative and may be exercised in whole or in part.
5. Manner of Exercise.
(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 of the Option Price for the Option Shares to be acquired in accordance with
the terms and conditions of this Agreement and the Plan.