Exhibit 10.6
LOOPNET, INC.
2006 EQUITY INCENTIVE PLAN
STOCK OPTION AGREEMENT (NONSTATUTORY)
     THIS STOCK OPTION AGREEMENT (the “Agreement”) dated [GRANT DATE] (“Grant
Date”) between LoopNet, Inc., a Delaware corporation (the “Company”), and
[EMPLOYEE NAME] (“Optionee”), is entered into as follows:
WITNESSETH:
     WHEREAS, the Company has established the 2006 Equity Incentive Plan (the
“Plan”); and
     WHEREAS, the Compensation Committee of the Board of Directors of the
Company or its delegates (the “Committee”) has determined that Optionee shall be
granted an option under the Plan as hereinafter set forth;
     The parties hereby agree that the Company grants, effective as of the Grant
Date, Optionee an option (this “Option”) to purchase [SHARES] shares of its
$0.001 par value Common Stock (the “Shares”) upon the terms and conditions set
forth in this Agreement.
1. Plan Award. This Option is granted under and pursuant to the Plan and is
subject to each and all of the provisions thereof.
2. Exercise Price. The exercise price applicable to this Option (meaning, the
price Optionee must pay in order to purchase any Shares hereunder) shall be
[PRICE] per Share.
3. Vesting and Exercise of Option. Subject to Optionee’s not experiencing a
Termination of Employment during the following vesting period, Optionee shall
vest in and earn the right to exercise this Option on the following schedule:
100% of the Shares shall vest and become exercisable upon the achievement of a
trailing four (4) quarters of Adjusted EBITDA per share equal to one dollar and
twenty seven cents ($1.27) at the end of any fiscal quarter of the Company that
occurs on or prior to [GRANT DATE], 2017, with Adjusted EBITDA equal to Adjusted
EBITDA as reported in the Company’s most recent earnings announcement and
outstanding shares for purposes of the per share calculation equal to the
weighted average fully diluted outstanding shares during the twelve (12) months
trailing the end of the applicable quarter.
This Agreement shall not be subject to the LoopNet, Inc. Change of Control
Severance Agreement entered into by and between Employee and the Company
effective as of December 18, 2008 (the “Change of Control Agreement”) and the
Shares shall not be eligible to vest and become exercisable pursuant to the
Change of Control Agreement notwithstanding anything stated therein. Further,
notwithstanding the above or anything stated herein to the contrary, if a
“Change of Control” (as defined in the Change of Control Agreement) occurs while
this Agreement is outstanding, the Shares shall vest and become exercisable as
follows:
(x) 1/3 of the Shares shall vest and become exercisable if the Change of Control
occurs prior to [GRANT DATE], 2011;

 

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(y) 2/3 of the Shares shall vest and become exercisable if the Change of Control
occurs prior to [GRANT DATE], 2012; or
(z) 100% of the Shares shall vest and become exercisable if the Change of
Control occurs on or after [GRANT DATE], 2012.
4. Expiration. This Option will expire seven (7) years from the Grant Date,
unless sooner terminated or canceled in accordance with the provisions of the
Plan. This means that (subject to the continuing service requirement set forth
in Section 3 above and subject to earlier termination upon certain other events
as set forth in the Plan) this Option must be exercised, if at all, on or before
[EXPIRE DATE] (the “Expiration Date”). If this Option expires on a stock
exchange holiday or weekend day, this Option will expire on the last trading day
prior to the holiday or weekend. Optionee shall be solely responsible for
exercising this Option, if at all, prior to its Expiration Date. The Company
shall have no obligation to notify Optionee of this Option’s expiration.
5. Exercise Mechanics. This Option may be exercised by delivering to the Stock
Plan Administrator at the Company’s head office a written or electronic notice
stating the number of Shares as to which the Option is exercised or by any other
method the Committee has approved. The notice must be accompanied by the payment
of the full Option exercise price of such Shares. Exercise shall not be deemed
to have occurred unless and until Optionee has delivered to the Company (or its
authorized representative) an approved notice of exercise, full payment of the
exercise price for the Shares being exercised and payment of any applicable
withholding taxes in accordance with Section 8 below. Payment of the Option
exercise price may be in cash (including check or wire transfer), through an
approved cashless-brokered exercise program, with shares of the Company’s Common
Stock (subject to the Company’s discretion to withhold approval for such payment
method at any time) or a combination thereof to the extent permissible under
Applicable Law; provided, however, that any permitted method of payment shall be
in strict compliance with all procedural rules established by the Committee.
6. Termination of Employment. All rights of Optionee in this Option, to the
extent that it has not previously become vested and been exercised, shall
terminate upon Optionee’s Termination of Employment except as set forth in this
Section 6. The portion of the Option that relates to any Shares that were
unvested and unexercisable as of the date of Optionee’s Termination of
Employment shall terminate and expire effective immediately upon such date. With
respect to the vested and exercisable portion of the Option, and subject to the
final sentence of this Section 6:
     (i) In the event of Termination of Employment other than as a result of
Optionee’s death or disability, Optionee shall have 60 days to exercise the
Option as to the Shares subject to the Option that were vested and exercisable
as of the date of Termination of Employment; provided that if during any part of
such 60 day period, the Option is not exercisable because the issuance of the
Shares would violate the registration requirements under the Securities Act, the
Option shall not expire until the Option shall have been exercisable for an
aggregate of 60 days after the date of Termination of Employment; provided
further that if during any part of such 60 day period, the Shares issued upon
exercise of the Option may not be sold because Optionee has material nonpublic
information regarding the Company or is otherwise subject to a trading blackout
period under the Company’s Insider Trading Compliance Program, the Option shall
not expire until Optionee shall have had an aggregate of 60 days after the date
of Termination of

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Employment during which Optionee can sell the Shares without being subject to
such restrictions arising under insider trading laws or Company policy; and
provided further that notwithstanding the foregoing, in no event may this Option
be exercised more than one year after the date of Termination of Employment; and
     (ii) In the event of Termination of Employment as a result of Optionee’s
death or disability (including a Total and Permanent Disability), Optionee shall
have one (1) year to exercise the Option as to the Shares subject to the Option
that were vested and exercisable as of the date of Termination of Employment.
Notwithstanding the above, in no event may an Option be exercised, even as to
vested and otherwise exercisable Shares, after the Expiration Date set forth in
Section 4 above.
7. Transferability. This Option generally is not transferable by Optionee
otherwise than by will or the laws of descent and distribution, and is
exercisable only by Optionee during Optionee’s lifetime; provided however that
this Option may be transferred by instrument to an inter vivos or testamentary
trust in which the Option is to be passed to beneficiaries upon the death of the
trustor (settlor) or by gift or pursuant to domestic relations orders to
“Immediate Family Members” (as defined below) of the Optionee. “Immediate
Family” means any child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law (including
adoptive relationships), a trust in which these persons have more than fifty
percent of the beneficial interest, a foundation in which these persons (or the
Optionee) control the management of assets, and any other entity in which these
persons (or the Optionee) own more than fifty percent of the voting interests.
8. Tax Matters. Regardless of any action the Company or Optionee’s employer (the
“Employer”) takes with respect to any or all income tax, social security,
payroll tax, payment on account or other tax-related withholding (“Tax-Related
Items”), Optionee acknowledges and agrees that the ultimate liability for all
Tax-Related Items legally due by him or her is and remains Optionee’s
responsibility and that the Company and/or the Employer (i) make no
representations nor undertakings regarding the treatment of any Tax-Related
Items in connection with any aspect of this Option, including the grant, vesting
or exercise of this Option, the subsequent sale of Shares acquired pursuant to
such exercise and receipt of any dividends; and (ii) do not commit to structure
the terms or the grant or any aspect of this Option to reduce or eliminate
Optionee’s liability for Tax-Related Items. Prior to the exercise of this
Option, Optionee shall pay or make adequate arrangements satisfactory to the
Company and/or the Employer to withhold all applicable Tax-Related Items legally
payable by Optionee from Optionee’s wages or other cash compensation paid to
Optionee by the Company and/or the Employer or from proceeds of the sale of
Shares. Alternatively, or in addition, if permissible under Applicable Laws, the
Company may (but shall not be obligated to): (1) sell or arrange for the sale of
Shares that Optionee acquires to meet the withholding obligation for Tax-Related
Items, and/or (2) withhold in Shares, provided that the Company only withholds
the amount of Shares necessary to satisfy the minimum withholding amount. In
addition, Optionee shall pay the Company or the Employer any amount of
Tax-Related Items that the Company or the Employer may be required to withhold
as a result of Optionee’s participation in the Plan or Optionee’s purchase of
Shares that cannot be satisfied by the means previously described, and if
Optionee does not otherwise so pay the Company or the Employer, then the Company
or the Employer may withhold amounts from Optionee’s cash compensation to
satisfy such withholding

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obligation. The Company may refuse to honor the exercise and refuse to deliver
the Shares if Optionee fails to comply with Optionee’s obligations in connection
with the Tax-Related Items (including if Optionee’s cash compensation is not
sufficient to satisfy such obligations). Although Optionee is being provided in
the Plan prospectus a description of certain tax consequences of transactions
related to the Option, Optionee remains responsible for all such tax
consequences and the Company shall not be deemed to provide any individual tax
advice with respect thereto.
9. Optionee Acknowledgements. By accepting the grant of this Option, Optionee
acknowledges and agrees that the Plan is established voluntarily by the Company,
it is discretionary in nature and may be modified, amended, suspended or
terminated by the Company at any time unless otherwise provided in the Plan or
this Agreement. Optionee acknowledges that all decisions with respect to future
grants, if any, will be at the sole discretion of the Company. Optionee’s
participation in the Plan shall not create a right to further employment with
Employer and shall not interfere with the ability of Employer to terminate
Optionee’s employment relationship at any time with or without cause and it is
expressly agreed and understood that employment is terminable at the will of
either party, insofar as permitted by law. Optionee agrees that this Option is
an extraordinary item that does not constitute compensation of any kind for
services of any kind rendered to the Company or the Employer, and is outside the
scope of Optionee’s employment contract, if any. This Option is not part of
normal or expected compensation or salary for any purposes, including, but not
limited to calculating any severance, resignation, termination, redundancy,
end-of-service payments, bonuses, long-service awards, pension or retirement
benefits or similar payments insofar as permitted by law. In the event that
Optionee is not an employee of the Company, this Option grant will not be
interpreted to form an employment contract or relationship with the Company, the
Employer or any Subsidiary or Affiliate of the Company. Optionee acknowledges
that the future value of the underlying Shares is unknown, may increase or
decrease in the future, and cannot be predicted with certainty. In consideration
of the grant of this Option, no claim or entitlement to compensation or damages
shall arise from termination of this Option or diminution in value of this
Option or Shares purchased through exercise of this Option resulting from
Optionee’s Termination of Employment by the Company or the Employer (for any
reason whatsoever and whether or not in breach of Applicable Laws).
10. Data Transfer. Optionee explicitly and unambiguously consents to the
collection, use and transfer, in electronic or other form, of Optionee’s
personal data as described in this document by and among, as applicable, the
Employer, and the Company and its Subsidiaries and Affiliates for the exclusive
purpose of implementing, administering and managing Optionee’s participation in
the Plan. Optionee understands that the Company, its Affiliates, its
Subsidiaries and the Employer hold certain personal information about Optionee,
including, but not limited to, name, home address and telephone number, date of
birth, social security number (or other identification number), salary,
nationality, job title, any shares of stock or directorships held in the
Company, details of all options or any other entitlement to shares of stock
awarded, canceled, purchased, exercised, vested, unvested or outstanding in
Optionee’s favor for the purpose of implementing, managing and administering the
Plan (“Data”). Optionee understands that the Data may be transferred to any
third parties assisting in the implementation, administration and management of
the Plan, that these recipients may be located in Optionee’s country or
elsewhere and that the recipient country may have different data privacy laws
and protections than Optionee’s country. Optionee may request a list with the
names and addresses of any potential recipients of the Data by contacting the
Stock Plan Administrator. Optionee authorizes the

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recipients to receive, possess, use, retain and transfer the Data, in electronic
or other form, for the purposes of implementing, administering and managing
Optionee’s participation in the Plan, including any requisite transfer of such
Data, as may be required to a broker or other third party with whom Optionee may
elect to deposit any Shares acquired upon the exercise of this Option. Optionee
understands that Data will be held only as long as is necessary to implement,
administer and manage participation in the Plan. Optionee may, at any time, view
Data, request additional information about the storage and processing of the
Data, require any necessary amendments to the Data or refuse or withdraw the
consents herein, in any case without cost, by contacting the Stock Plan
Administrator in writing. Optionee understands that refusing or withdrawing
consent may affect Optionee’s ability to participate in the Plan. For more
information on the consequences of refusing to consent or withdrawing consent,
Optionee may contact the Stock Plan Administrator at the Company.
11. Copies of Plan Materials. Optionee acknowledges that Optionee has received
copies of the Plan and the Plan prospectus from the Company and agrees to
receive stockholder information, including copies of any annual report, proxy
statement and periodic report, from the investors section of the Company’s
website at http://www.loopnet.com. Optionee acknowledges that copies of the
Plan, Plan prospectus, Plan information and stockholder information are also
available upon written or telephonic request to the Stock Plan Administrator.
12. Entire Agreement; Plan Controls. The Plan is incorporated herein by
reference. The Plan and this Agreement constitute the entire agreement of the
parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to
Optionee’s interest except by means of a writing signed by the Company and
Optionee. This Agreement is governed by the laws of the state of Delaware. In
the event of any conflict between the terms and provisions of the Plan and this
Agreement, the Plan terms and provisions shall govern. Capitalized terms used
but not defined in this Agreement have the meanings assigned to them in the
Plan. Certain other important terms governing this Agreement are contained in
the Plan.

                  Accepted by Optionee:       LOOPNET, INC.    
 
               
 
      By:        
 
[Optionee Name]
      Name:  
 
   
 
      Title:  
 
   
 
         
 
   

RETAIN THIS AGREEMENT FOR YOUR RECORDS

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