Circuit City 2006 Annual Report Download - page 63

Participant for at least six months (which are not the subject of any pledge or other security interest), (c) by providing with
the notice of exercise an order to a designated broker to sell part or all of the Shares and to deliver sufficient proceeds to the
Company, in cash or by check payable to the order of the Company, to pay the full purchase price of the Shares, or (d) by a
combination of the foregoing, provided that the combined value of all cash and cash equivalents and the Fair Market Value of
any such Shares so tendered to the Company as of the date of such tender is at least equal to such option price (and any
withholding taxes, if applicable).
Exercisability and Term of Options . Options shall be exercisable immediately (but not before stockholder approval of the
Plan) and shall be exercisable until the earlier of (A) ten years from the date of grant and (B) the expiration of the period
provided in the paragraph below entitled Termination of Service as Eligible Director. If the Plan is not approved at the
Annual Stockholders Meeting in 2006, any options granted before such meeting shall be void and of no force or effect.
Termination of Service as Eligible Director . Upon termination of a Participant’s service as a director of the Company for
any reason, all outstanding options held by such Participant, to the extent then exercisable, shall be exercisable in whole or in
part for a period of one year from the date upon which the Participant ceases to be a director, provided that in no event shall
the options be exercisable beyond ten years from the date of grant.
Non-transferability of Options . No option may be assigned, alienated, pledged, attached, sold or otherwise transferred or
encumbered by a Participant otherwise than by will or the laws of descent and distribution, and during the lifetime of the
Participant to whom an option is granted it may be exercised only by the Participant or by the Participant’s guardian or legal
representative. Notwithstanding the foregoing, options may be transferred pursuant to a qualified domestic relations order.
Option Agreement . Each option granted hereunder shall be evidenced by an agreement with the Company which shall
contain the terms and provisions set forth herein and shall otherwise be consistent with the provisions of the Plan.
Grant, Terms and Conditions of Restricted Stock Awards
If the Plan is approved at the Annual Stockholders Meeting in 2006, then immediately following each Annual Stockholders
Meeting (commencing with the Annual Stockholders Meeting in 2006), but only upon the registration of the common stock to
be issued under the Plan with the Securities and Exchange Commission, each person who is an Eligible Director immediately
following such meeting will be granted, as of the date of such meeting, a restricted stock award with respect to such number
of shares as is determined by dividing (i) $25,000, by (ii) the average of the Fair Market Value per Share during the 20
trading days preceding the date of such meeting (rounded up to the nearest whole number of Shares). No fractional shares
shall be issued. All Shares subject to a restricted stock award granted hereunder shall hereinafter be referred to as “Restricted
Shares”.
All Restricted Shares granted pursuant to the Plan shall be subject to the following conditions:
The restrictions imposed on the transfer of the Restricted Shares subject to each restricted stock award granted to a Participant
shall lapse, and said Restricted Shares shall become nonforfeitable and transferable twenty-four (24) months following the
date on which each such restricted stock award is granted, if within such period the Participant’s service as a director of the
Company has not ceased. If the Participant’s service as a director of the Company ceases before twenty-four (24) months
following the date on which a restricted stock award is granted, then, except as provided below, the Restricted Shares subject
to such restricted stock award shall be forfeited. Notwithstanding the preceding, all restrictions imposed on the transfer of the
Restricted Shares subject to each restricted stock award granted pursuant to the Plan shall lapse, and all such Restricted
Shares shall become non-forfeitable, (i) upon the death or disability of the Participant while serving as a director of the
Company, or (ii) upon the Participant’s cessation of service as a director in connection with a Change in Control. For
purposes of the Plan, a Change in Control shall mean an acquisition, merger or other transaction resulting in the Leeds family
(including Richard Leeds, Robert Leeds and Bruce Leeds) directly or indirectly owning less than 50% of the then outstanding
•
the Restricted Shares may not be sold, transferred, or otherwise alienated or hypothecated until the restrictions are
removed or expire;
• each certificate representing Restricted Shares shall bear a legend making appropriate reference to the restrictions
imposed; and
• such other conditions and restrictions as may be required under the requirements of any stock exchange upon which
such Shares or shares of the same class are then listed, and under any securities law applicable to such Shares, shall be
imposed on such Shares.