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EXHIBIT 4.3




Execution Copy




RIGHT MEDIA INC.




STOCK OPTION AGREEMENT




     THIS AGREEMENT made as of March 1, 2005, by and between Right Media Inc., a Delaware
corporation (the “Company”), and Michael Walrath (“Walrath”).



WITNESSETH:




     WHEREAS, the Board has authorized the grant to Walrath of this option to acquire Stock in the
Company, on the terms and conditions set forth herein.



     NOW, THEREFORE, in consideration of the premises contained herein, the Company and Walrath
hereby agree as follows:



     1. Definitions.



     “Board” shall mean the Board of Directors of the Company.



     “Cause” shall have the meaning set forth in Walrath’s Employment Agreement with the Company.



     “Change of Control” shall mean the satisfaction of any one or more of the following conditions
(and the “Change of Control” shall be deemed to have occurred as of the first day that any one or
more of the following conditions shall have been satisfied):




     (a) Any person (as such term is used in paragraphs 13(d) and 14(d)(2) of the Exchange
Act, hereinafter in this definition, “Person”), other than the Company or an affiliate of
the Company or an employee benefit plan of the Company or such affiliate, becomes the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company representing more than 50% of the combined voting power of the
Company’s then outstanding securities;




     (b) The closing of a merger, consolidation or other business combination (a “Business
Combination”) other than a Business Combination in which holders of common stock of the
Company immediately prior to the Business Combination have substantially the same
proportionate ownership of common stock of the surviving corporation immediately after the
Business Combination as immediately before;




     (c) The closing of the sale or disposition of all or substantially all of the Company’s
assets to any entity that is not an affiliate of the Company;




     (d) The persons who were members of the Board immediately before a tender offer by any
Person other than the Company, or before a merger, consolidation or contested election, or
before any combination of such transactions, cease to constitute a majority of the members
of the Board as a result of such transaction or transactions; or



 









 






     (e) Any other event which shall be deemed by a majority of the members of the Board to
constitute a “Change of Control.”



     “Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time.



     “Company” shall mean Right Media Inc., a Delaware corporation.



     “Disability” shall mean the inability to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be expected to result in
death or which has lasted or can be expected to last for a continuous period of not less than 12
months, all as described in Section 22(e)(3) of the Code.



     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.



     “Fair Market Value” shall mean on any date, (i) if the Stock is not listed on a national
securities exchange or quoted on NASDAQ, the fair market value of the Stock on that date as
determined by the Board, or (ii) if the Stock is listed on a national securities exchange or is
quoted on NASDAQ, the closing price reported on the composite tape for issues listed on such
exchange on such date, or the closing price or the average of the closing dealer “bid” and “asked”
prices for the Stock as quoted on NASDAQ, or if no trades shall have been reported for such date,
on the next preceding date on which there were such trades reported; provided, however, that if no
quotations shall have been made within the 10 business days immediately preceding such date, Fair
Market Value shall be determined by the Board.



     “Family Member” shall mean, with respect to Walrath, any child, stepchild, grandchild, parent,
stepparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,
brother-in-law or sister-in-law, including adoptive relationships, any person sharing Walrath’s
household (other than a tenant of Walrath), a trust in which such persons have more than 50% of the
beneficial interest, a foundation in which such persons (or Walrath) control the management of
assets and any other entity in which such persons (or Walrath) own more than 50% of the voting
interests.



     “Rule 16b-3” shall mean Rule 16b-3 promulgated by the Securities Exchange Commission under
Section 16, or any successor rule.



     “Section 16” shall mean Section 16 of the Exchange Act or any successor statute.



     “Shares” shall mean shares of Stock.



     “Stock” shall mean authorized but unissued shares of the Common Stock of the Company, par
value $0.01 per share, or reacquired shares of the Company’s Common Stock.



     2. Grant of Option. The Company hereby grants to Walrath an option to purchase Two
Thousand, Five Hundred (2,500) shares of the Company’s Stock for an exercise price per Share equal
to $297.06 (the “Option”). This is not an incentive stock option within the meaning of Section 422
of the Code.



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     3. Option Terms. Walrath may exercise all or any part of the Option by no later than
the day prior to the tenth anniversary of the date of this Agreement (the “Option Period”).



     4. Exercise of Option.




     (a) The Option shall become exercisable at such time as shall be provided herein and
shall be exercisable by written notice of such exercise, in the form prescribed by the
Board, to the Secretary of the Company, at its principal office. The notice shall specify
the number of Shares for which the Option is being exercised.




     (b) Shares purchased pursuant to the Option shall be paid for in full at the time of
such purchase in cash or by check, bank draft or postal or express money order or by
“cashless exercise,” as prescribed by the Board, or by any other method made available by
the Board.



     5. Vesting. The Option shall vest and become exercisable pursuant to the following
schedule:



	 	 	 
	 	 	Number of Vested and
	Service for the Company	 	Exercisable Shares Subject to
	from Date of Grant 	 	Option
	Terminated prior to March 1, 2006
	 	0
	 
	 	 
	Terminated on or after March 1, 2006

	 	625 Shares as of March 1, 2006,
plus an additional 52.08 Shares
per calendar month of service
following March 1, 2006, with all
2,500 Shares becoming fully vested
and exercisable as of March 1, 2009





Notwithstanding the above schedule, upon an acquisition of the Company or other Business
Combination that constitutes a Change of Control, if, within thirty (30) days of the occurrence of
the Change of Control, Walrath is not offered employment with the purchaser/surviving entity on
substantially comparable employment terms and conditions (including, but not limited to, cash and
equity compensation and benefits) to those Walrath had in connection with Walrath’s employment with
the Company immediately prior to such Change of Control, fifty percent (50%) of the then nonvested
portion of the Option shall vest and become exercisable, unless the valuation of the Company
determined by such acquisition or other Business Combination, or proceeds available for
distribution to the Company’s stockholders as a result thereof, exceeds $150 million, in which
case, the Option shall thereupon become fully vested and exercisable.




     6. Termination of Employment.




     (a) Walrath shall forfeit any unvested portion of the Option upon termination of
employment with the Company for any reason.



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     (b) Except as provided in paragraphs (c) and (d) below, if Walrath’s employment with
the Company is terminated other than by the Company for Cause, only that portion of the
Option held by Walrath which was immediately exercisable at the termination of Walrath’s
employment shall be exercisable by Walrath following the termination of Walrath’s
employment. Such Option must be exercised within 30 days following such termination of
employment (but in no event after expiration of the Option Period) or they shall be
forfeited.




     (c) Notwithstanding anything to the contrary contained in paragraph (b) above, if
Walrath’s employment with the Company is terminated by the Company for Cause, any portion of
this Option outstanding held by Walrath shall expire immediately and such Option shall not
be exercisable after the termination of Walrath’s employment.




     (d) Notwithstanding anything to the contrary contained in paragraphs (b) and (c) above,
if Walrath’s employment with the Company is terminated on account of Walrath’s death or
Disability, only that portion of this Option held by Walrath which was immediately
exercisable at the date of Walrath’s death or Disability, as applicable, shall be
exercisable by Walrath, the representative of Walrath’s estate or Walrath’s beneficiaries to
whom the Option has been transferred. Such portion of the Option must be exercised by the
earlier of (i) 6 months from the date of Walrath’s death or Disability, as applicable, or
(ii) the expiration of the Option Period, or they shall be forfeited.



     7. Special Rules.




     (a) Right of First Refusal. Solely during such time that the Stock is not
publicly traded, neither Walrath (nor a beneficiary of Walrath including, but not limited
to, Walrath’s estate) may sell or otherwise transfer (except for intervivos transfers to
Family Members pursuant to Section 9) any Stock obtained thereby pursuant to the exercise of
this Option hereunder without first (i) providing the Company with a written offer to sell
the Stock to the Company on the same terms as were offered to Walrath (or Walrath’s
beneficiary) by a third party (a copy of which third party offer shall be attached to
Walrath’s or his beneficiary’s offer to sell such Stock to the Company) for a sales price
equal to that stated in the third party’s purchase offer, and (ii) waiting 60 days from the
date of the Company’s receipt of such offer. If the Company shall accept Walrath’s or his
beneficiary’s offer in writing within said 60 day period, Walrath or his beneficiary and the
Company shall promptly effect such transaction. If the Company does not provide a written
acceptance of Walrath’s or his beneficiary’s offer within said 60 day period, the Grantee or
beneficiary shall be entitled to accept such third party’s offer and effect such
transaction.




     (b) Call Option. Solely during such time that the Stock is not publicly
traded, upon the termination of Walrath’s employment with the Company, the Company shall
have the right to purchase from such individual or from such individual’s estate, for a
period of 30 days following the date of such termination, any Stock obtained thereby
pursuant to the exercise of an Option hereunder for a purchase price equal to the exercise
price paid by Walrath, in connection with such Option.



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     8. Recapitalization Adjustments.




     (a) In the event of any change in capitalization affecting the Stock, including,
without limitation, a stock dividend or other distribution, stock split, reverse stock
split, recapitalization, consolidation, subdivision, split-up, spin-off, split-off,
combination or exchange of shares or other form of reorganization or recapitalization, or
any other change affecting the Stock, the Board shall authorize and make such proportionate
adjustments, if any, as the Board shall deem appropriate to reflect such change, including,
without limitation, with respect to the aggregate number of shares of Stock subject to this
Option and the purchase price per share of Stock in respect of this Option.




     (b) Any provision hereof to the contrary notwithstanding, in the event the Company is a
party to a merger or other reorganization, the Board shall determine the treatment of this
Option, which treatment may include the assumption of this Option by the surviving company
or its parent, their continuation by the Company (if the Company is the surviving company),
accelerated vesting and/or accelerated expiration or settlement in cash.



     9. Restrictions on Transfer of Option . This Agreement and the Option shall not be
transferable otherwise than by will or by the laws of descent and distribution other than as an
intervivos gift to a Family Member, and the Option shall be exercisable, during Walrath’s lifetime,
solely by Walrath, except on account of Walrath’s Disability.



     10. Regulation by the Board . This Agreement and the Option shall be subject to the
administrative procedures and rules as the Board shall adopt. All decisions of the Board upon any
question arising under this Agreement, shall be conclusive and binding upon Walrath and any person
or persons to whom any portion of the Option has been transferred by will, by the laws of descent
and distribution or by intervivos gift to a Family Member.



     11. Reservation of Shares . With respect to the Option, the Company hereby agrees to
at all times reserve for issuance and/or delivery upon payment by Walrath of the Option price, such
number of Shares as shall be required for issuance and/or delivery upon such payment pursuant to
the Option.



     12. Delivery of Share Certificates . Within a reasonable time after the exercise of
the Option the Company shall cause to be delivered to Walrath, his legal representative or his
beneficiary, a certificate for the Shares purchased pursuant to the exercise of the Option.



     13. Withholding . In the event Walrath elects to exercise the Option (or any part
thereof), if the Company shall be required to withhold any amounts by reason of any federal, state
or local tax rules or regulations in respect of the issuance of Shares to Walrath, the Company
shall be entitled to deduct and withhold such amounts.



     14. Amendment . The Board may amend this Agreement at any time and from time to time;
provided, however, that no amendment of this Agreement that would materially and adversely impair
Walrath’s rights or entitlements with respect to the Option shall be effective without the prior
written consent of Walrath.



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     15. Market-Standoff Period.




     (a) In connection with the initial public offering of the Company’s securities and upon
request of the Company or the underwriters managing such offering of the Company’s
securities, Walrath agrees not to sell, make any short sale of, loan, grant any option for
the purchase of, or otherwise dispose of any securities of the Company (other than those
included in the registration) without the prior written consent of the Company or such
underwriters, as the case may be, for such period of time (not to exceed 180 days) from the
effective date of such registration as may be requested by the Company or such managing
underwriters and to execute an agreement reflecting the foregoing as may be requested by the
underwriters at the time of the Company’s initial public offering.




     (b) The obligations described in Section 15(a) hereof shall apply only if all officers
and directors of the Company and each holder of one percent (1%) or more of the Company’s
capital stock on a fully diluted basis enter into similar agreements, and shall not apply to
a registration relating solely to employee benefit plans, or to a registration relating
solely to a transaction pursuant to Rule 145 under the Securities Act.




     (c) In order to enforce the foregoing covenants, the Company may impose stop-transfer
instructions with respect to the securities of Walrath (and the securities of every other
person subject to the restrictions in Section 15(a) hereof).



     16. Effective Date of Grant . The Option shall be effective as of the date first
written above.



     17. General.




     (a) The granting of this Option shall not give Walrath any right to similar grants in
future years or any right to be retained as an employee of the Company. Walrath shall
remain subject to discharge or removal to the same extent as if this Option were not in
effect.




     (b) Neither Walrath nor any beneficiary or other person claiming under or through him,
shall have any right, title or interest by reason of any Option to any particular assets of
the Company, or any shares of Stock, except as set forth herein.




     (c) Notwithstanding any other provision of this Agreement, the Company’s obligation to
issue or deliver any certificate or certificates for shares of Stock under this Option, and
the transferability of Stock acquired by exercise of this Option, shall be subject to all of
the following conditions:




     (i) Any registration or other qualification of such shares under any state or
federal law or regulation, or the maintaining in effect of any such registration or
other qualification which the Board shall, in its absolute discretion upon the
advice of counsel, deem necessary or advisable;



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     (ii) The obtaining of any other consent, approval or permit from any state or
federal governmental agency which the Board shall, in its absolute discretion upon
the advice of counsel, determine to be necessary or advisable; and




     (iii) Each Stock certificate issued pursuant to the exercise of this Option
shall bear such legends which the Company shall determine, in its absolute
discretion, are necessary or advisable, or which in the opinion of counsel to the
Company are required under applicable federal or state securities laws.




     (d) The Company shall issue any Stock certificates required to be issued in connection
with the exercise of this Option with reasonable promptness following such exercise.




     (e) The grant of and exercise of this Option shall be subject to, and shall in all
respects comply with, the applicable laws of Delaware.




     (f) Should Walrath’s receipt and/or exercise of this Option be subject to Section 16,
it is the express intent of the Company that this Option satisfy and be interpreted in a
manner to achieve the result that the applicable requirements of Rule 16b-3 shall be
satisfied with respect to Walrath with the result that Walrath shall be entitled to the
benefits of Rule 16b-3 or other applicable exemptive rules under Section 16. If any
provision of this Option would otherwise frustrate or conflict with the intent of the
Company set forth in the immediately preceding sentence, to the extent possible, such
provision shall be interpreted and deemed amended so as to avoid such conflict, and, to the
extent of any remaining irreconcilable conflict with such intent, the provision shall be
deemed void.




     (g) It is the express intention of the Company that this Option satisfy and be
interpreted in a manner to achieve the result that the grant of this Option shall constitute
“performance-based compensation” for purposes of Section 162(m) of the Code. If any
provision of this Option would otherwise frustrate or conflict with the intent of the
Company set forth in the immediately preceding sentence, to the extent possible, such
provision shall be interpreted and deemed amended so as to avoid such conflict, and to the
extent of any remaining irreconcilable conflict with such intent, the provision shall,
solely with respect to the restrictions contained in Section 162(m) of the Code, be deemed
void.



[The remainder of this page is intentionally blank.]




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     18. Walrath Acknowledgment . By executing this Agreement, Walrath hereby acknowledges
that he (a) has received and read this Agreement and agrees to be bound by all of the terms of this
Agreement, and (b) upon exercising any portion of the Option, if he is required to, shall enter
into and be bound by all of the terms of the Company’s Shareholders’ Agreement, if any.




	 	 	 	 	 
	 
	 

	 	RIGHT MEDIA, INC.
	 	 
	 
	 	 	 	 
	 

	 	/s/ Christine Hunsicker	 	 
	 

	 	Christine Hunsicker	 	 
	 

	 	Title: Chief Operating Officer	 	 
	 
	 	 	 	 
	 

	 	/s/ Michael Walrath	 	 
	 

	 	Michael Walrath	 	 







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