Exhibit 10.20

FORM OF NOTICE OF GRANT OF EXECUTIVE OFFICER STOCK OPTION

(TIME-BASED)

To:                      (the “Optionee”)

As per the general terms and conditions set forth on this Stock Option Agreement
(the “Agreement”), and the Amended and Restated 2003 Stock Incentive Plan, as
amended to date (the “Plan”), Exhibit A and Exhibit B, respectively, which may
be found at http://intranet.marchex.com, you have been granted an option (the
“Option”) to purchase the number of shares set forth below (the “Shares”) of
Class B Common Stock, $.01 par value per share (the “Common Stock”) of Marchex,
Inc. (the “Company”), for the aggregate Purchase Price set forth below (the
“Purchase Price”), with the following specific terms and conditions:

 

Grant Date and

Vesting Commencement Date:

                       Exercise Price Per Share:                        Total
Number of Shares Subject to Option:                        Total Purchase Price:
                      

Type of Option:

  The Option shall be an incentive stock option to the extent permitted by the
Internal Revenue Code of 1986, as amended, (the “Code”), and otherwise a
nonqualified stock option. Vesting Schedule:   Until otherwise terminated under
the Plan or the Agreement and assuming the Optionee is employed by the Company
or continues to work as a consultant for the Company on the applicable vesting
date, the Shares underlying this Option shall vest in accordance with the
following vesting schedule: 25% of the Shares underlying this Option shall vest
on the first annual anniversary of the Grant Date and 1/12th of the remainder
shall vest quarterly thereafter for the following three years in equal
increments and according to such other conditions as are set forth in the
Agreement and the Plan.   Notwithstanding the foregoing, one hundred percent
(100%) of the Shares underlying this Option not already vested as of the date
thereof, shall become immediately vested upon the occurrence of both (a) a
Change of Control, (b) followed by (i) a termination without cause of the
Optionee’s employment by the Company or any successor thereto, (ii) a Diminution
in Duties with respect to the Optionee, or (iii) the 12 month anniversary of the
occurrence of the Change of Control.   For the purposes hereof, “Change of
Control” shall mean the occurrence of any of the following events:     (i)   an
acquisition (other than directly from the Company) of any voting securities of
the Company (the “Voting Securities”) by any “Person” or “Group” (as such terms
are used for the purposes of Section 13(d) or 14(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”)) immediately after which such
Person or Group has Beneficial Ownership (within the meaning of Rule l3d-3
promulgated under the Exchange Act) of fifty percent (50%) or more of the
combined voting power of the Company’s then-outstanding Voting

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      Securities; provided however, in determining whether or not a Change of
Control has occurred. Voting Securities which are acquired in a “Non-Control
Acquisition” (as hereinafter defined) shall not constitute an acquisition which
would constitute a Change of Control. A “Non-Control Acquisition” shall mean an
acquisition by (i) any employee benefit plan (or related trust) sponsored or
maintained by the Company or any affiliate of the Company, (ii) the Company,
(iii) any Person in connection with a Non-Control Transaction (as hereinafter
defined), or (iv) any holder of the Company’s Class A Common Stock as of the
date hereof;     (ii)   individuals who, as of the date hereof, constitute the
Board (the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company’s shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or     (iii)   the consummation of:         (a)   A merger, consolidation
or reorganization with or into the Company or in which securities of the Company
are issued, unless such merger, consolidation or reorganization is a
“Non-Control Transaction”. A “Non-Control Transaction” is a merger,
consolidation or reorganization with or into the Company or in which securities
of the Company are issued where:             A.   the shareholders, of the
Company immediately before such merger, consolidation, or reorganization, own,
directly or indirectly, at least fifty-one percent (51%) of the combined voting
power of the outstanding voting securities of the corporation resulting form
such merger, consolidation or reorganization (the “Surviving Corporation”) in
substantially the same proportion as their ownership of the Voting Securities
immediately before such merger, consolidation or reorganization,

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            B.   the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement providing for such merger,
consolidation or reorganization constitute at least a majority of the members of
the board of directors of the Surviving Corporation or a corporation owning
directly or indirectly fifty-one percent (51%) or more of the Voting Securities
of the Surviving Corporation, and             C.   no Person or Group, other
than (i) the Company, (ii) any subsidiary of the Company, (iii) any employee
benefit plan (or any trust forming a part thereof) maintained by the Company
immediately prior to such merger, consolidation, or reorganization, or (iv) any
holder of the Company’s Class A Common Stock as of the date hereof, owns twenty
percent (20%) or more of the combined voting power of the Surviving
Corporation’s then-outstanding voting securities; or         (b)   a complete
liquidation or dissolution of the Company; or         (c)   the sale of
disposition of all or substantially all of the assets of the Company to any
Person.   Notwithstanding the foregoing, a Change of Control shall not be deemed
to occur solely because any Person (the “Subject Person”) acquired Beneficial
Ownership of more than the permitted amount of the outstanding Voting Securities
as a result of the acquisition of Voting Securities by the Company which, by
reducing the number of Voting Securities outstanding, increases the proportional
number of shares Beneficially Owned by the Subject Person, provided that if a
Change of Control would occur (but for the operation of this sentence) and after
such acquisition of Voting Securities by the Company, the Subject Person becomes
the Beneficial Owner of any additional Voting Securities, then a Change of
Control shall occur.   For the purposes hereof, “Diminution in Duties” shall
mean the occurrence of any of the following events without the Optionee’s
express written consent;       (i)   a material diminution in the nature or
scope of the Optionee’s duties, responsibilities, authority, powers or functions
as compared to the Optionee’s duties, responsibilities, authority, powers or
functions immediately prior to the Change of Control;       (ii)   if the
Optionee is no longer (a) an executive officer of a publicly-traded company, or
(b) a Section 16 reporting person under the 1934 Act;       (iii)   a reduction
in the Optionee’s Annual Salary; or

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      (iv)   the relocation of Optionee’s office at which he is to perform his
duties and responsibilities hereunder to a location more than sixty (60) miles
from Seattle, Washington.   There shall be no proportionate or partial vesting
in the periods prior to the applicable vesting dates and all vesting shall occur
only on the appropriate vesting date. The Compensation Committee may, in its
sole discretion, provide for accelerated vesting of the Shares underlying this
Option at any time. Attorney’s Fees:   In the event that any suit or action is
instituted to enforce any provision in this Agreement, the prevailing party in
such dispute shall be entitled to recover from the losing party all fees, costs
and expenses of enforcing any right of such prevailing party under or with
respect to this Agreement, including without limitation, such reasonable fees
and expenses of attorneys and accountants, which shall include, without
limitation, all fees, costs and expenses of appeals. Except as otherwise
permitted by Section 409A of the Code, any reimbursement to which Optionee is
entitled pursuant to this paragraph shall (a) be paid no later than the last day
of Optionee’s taxable year following the taxable year in which the expense was
incurred, (b) not be affected by the amount of expenses eligible for
reimbursement in any other taxable year, and (c) not be subject to liquidation
or exchange for another benefit. Compliance with Section 409A:   The Company
intends that income provided to Optionee pursuant to this Agreement will not be
subject to taxation under Section 409A of the Code. The provisions of this
Agreement shall be interpreted and construed in favor of satisfying any
applicable requirements of Section 409A. However, the Company does not guarantee
any particular tax effect for income provided to Optionee pursuant to this
Agreement. In any event, except for the responsibility of the Company to
withhold applicable income and employment taxes from compensation paid or
provided to Optionee, the Company shall not be responsible for the payment of
any applicable taxes incurred by Optionee on compensation paid or provided to
Optionee pursuant to this Agreement. Integrated Agreement:   This Grant Notice,
the Agreement and the Plan, together with any employment, service or other
agreement between the Optionee and the Company or an Affiliate applicable to the
award, shall constitute the entire understanding and agreement of the Optionee
and the Company or an Affiliate with respect to the subject matter contained
herein or therein and supersede any prior agreements, understandings,
restrictions, representations, or warranties among the Optionee and the Company
and its Affiliate with respect to such subject matter other than those as set
forth or provided for herein or therein. To the extent contemplated herein or
therein, the provisions of this Grant Notice, the Agreement and the Plan shall
survive any exercise of the Option and shall remain in full force and effect.
Term/Expiration Date:   Ten (10) years from the date hereof or as set forth in
Section 2. Early Termination:   As set forth in Section 2 of the Agreement (but
in no event later than the Expiration Date).

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By the signatures set forth below, you and the Company agree that this Option is
granted under and governed by the terms and conditions of this Agreement and the
Plan, which is made a part of this document.

 

OPTIONEE:     MARCHEX, INC.

 

   

 

Signature     Name:     Title:

 

    Print Name    

 

    Social Security Number     Date (Required Field)    

 

   

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EXHIBIT A

Stock Option Agreement

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EXHIBIT B

Marchex, Inc. Amended and Restated 2003 Stock Incentive Plan, as amended to date