Exhibit 10.23


 


INCENTIVE STOCK OPTION AGREEMENT AMENDMENT


 


This Incentive Stock Option Agreement Amendment dated as of June 22,
2004 (this “Amendment”) is made by and between NeuStar, Inc. a
Delaware corporation having its principal place of business in Sterling,
Virginia (the “Company”), and John
Malone (the “Participant”). Capitalized terms not otherwise defined herein
shall have the meaning ascribed to such terms in the Option Agreement (as
defined below).


 


W I T N E S S E T H:


 


WHEREAS, Company granted Participant the
right and option to purchase from the Company 34,963 shares (the “Option Shares”)
of Company’s common stock, par value $.002 per share;


 


WHEREAS, Company and
Participant entered into an Incentive Stock Option Agreement under the NeuStar, Inc.
1999 Equity Incentive Plan (the “Option Agreement”) dated December 18,
2003;


 


WHEREAS, the Company and Participant
desire to amend the Option Agreement to revise the definitions of “Corporate
Transaction” under Section 5(d) thereof and the definition of “Good
Reason” under Section 5(e) thereof as set forth below.


 


NOW, THEREFORE, in
consideration of the premises and further valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:


 


1.     Amendment
to Section 5 (d) and 5(e) of the Option Agreement.  Subject to the terms and conditions set forth
herein, Sections 5 (d) and 5(e) of the Option Agreement are hereby
amended and restated in their entirety as follows:


 


“(d)  For purposes of this Agreement, a “Corporate Transaction”
shall mean any of the following events:


 


(i) The consummation of any merger or consolidation of the
Company, if immediately following such merger or consolidation the holders of
the Company’s outstanding voting securities immediately prior to such merger or
consolidation do not own at least a majority of the outstanding voting
securities of the surviving corporation in approximately the same proportion as
they did immediately prior to such merger or consolidation.


 


(ii) The consummation of any sale, lease, exchange or other
transfer in one transaction or a series of related


 





















 


transactions of all or substantially all of
the Company’s assets, other than a transfer of the Company’s assets to a
majority-owned subsidiary of the corporation, or to an entity in which the
holders of the majority of the outstanding voting securities of the entity
immediately prior to the transfer own at least the majority of the outstanding
securities immediately after such transfer in approximately the same proportion
as immediately prior to such transfer.


 


(iii) The approval by the holders of the Common Stock of any plan
or proposal for the liquidation or dissolution of the Company.


 


(iv) The acquisition by a person, within the meaning of Section 3(a)(9) or
of Section 13 (d)(3) of the Exchange Act of a majority or more of the
Company’s outstanding voting securities (whether directly or indirectly,
beneficially or of record), other than a person who held such majority on the
date of adoption of the Plan.  Ownership
of voting securities shall take into account and shall include ownership as
determined by applying Rule 13d-3(d)(1)(i) pursuant to the Exchange
Act.


 


(e)           For purposes of this
Agreement, “Good Reason” shall mean, without the Participant’s prior written
consent, any of the following events or conditions and the failure of the
Successor Corporation to cure such event or condition within thirty (30) days
after receipt of written notice from the Participant:


 


(i)            A
substantial diminution or material adverse change in the Participant’s status,
title, position, authority, duties or responsibilities (including reporting
responsibilities) as in effect immediately prior to a Corporate Transaction,
except in connection with the Participant’s termination of Service with the
Company for Cause, disability, death or by the Participant other than for Good
Reason.


 


(ii)           A
reduction in the Participant’s annual base salary, except in connection with an
across-the-board salary reduction of less than ten percent (10%) affecting all
senior executives of the Company.


 





















 


(iii)          The
Successor Corporation’s failure to cover the Participant under employee benefit
plans, programs and practices that, in the aggregate, provide substantially
comparable benefits (from an economic perspective) to the Participant relative
to the benefits and total costs under the material employee benefit plans,
programs and practices in which the Participant (and/or his family or
dependents) is participating immediately preceding the Corporate Transaction.


 


(iv)          The
Successor Corporation’s requiring the Participant to be based at any office
location that is more than fifty (50) miles further from the Participant’s
office location immediately prior to a Corporate Transaction; except for
reasonable required travel for the Successor Corporation’s business that is not
materially greater than such travel requirements prior to such Corporate
Transaction.


 


(v)           A
material breach by the Successor Corporation of its obligations to the
Participant under the Plan.”


 


2.     Entire
Agreement.  This Amendment sets forth
the entire understanding and agreement of the parties hereto in relation to the
subject matter hereof and supersedes any prior negotiations and agreements
among the parties relating to such subject matter.  None of the terms or conditions of this
Amendment may be changed, modified, waived or canceled orally or otherwise,
except in writing.


 


3.     Full
Force and Effect of Agreement. 
Except as hereby specifically amended, modified or supplemented, the
Option Agreement is hereby confirmed and ratified in all respects and shall be
and remain in full force and effect according to their respective terms.


 


4.     Counterparts.  This Amendment may be executed in any number
of counterparts, each of which shall be deemed an original as against any party
whose signature appears thereon, and all of which shall together constitute one
and the same instrument.


 


5.     Governing
Law.  This Amendment shall be
construed and interpreted in accordance with the laws of the Sate of Delaware,
without regards to the principles of conflicts of law.


 





















 


IN WITNESS WHEREOF,
the parties hereto have caused this Amendment to be made, executed and
delivered by their duly authorized officers as of the day and year first above
written.


 


	
   

  	
   

  	
  NEUSTAR,
  INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
    /s/
  Jeffrey E. Ganek

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Jeffrey E.
  Ganek

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chairman and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  OPTIONEE:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  John Malone

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ John S. Malone

  	
   

  
						



 





















 


INCENTIVE STOCK OPTION AGREEMENT


UNDER THE


NEUSTAR, INC. 1999 EQUITY INCENTIVE PLAN


 


THIS AGREEMENT, made as of December 18,
2003 (the “Effective Date”), by and between NeuStar, Inc., a
Delaware corporation (the “Company”), and John Malone (the “Participant”).


 


W
I  T  N  E  S  S  E  T  H:


 


WHEREAS, the Company desires to afford the Participant the opportunity
to acquire an ownership of the Company’s common stock, par value $.002 per
share (“Common Stock”), so that the Participant may have a direct proprietary
interest in the Company’s success.


 


NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties hereto hereby agree as follows:


 


1.             Grant of Option.  Subject to the terms and conditions set forth
herein and in the Company’s 1999 Equity Incentive Plan, as restated as of March 13,
2002 (the “Plan”), the Company hereby grants to the Participant, during the
period commencing on the date of this Agreement and ending on December 18,
2013 (the “Expiration Date”), the right and option (the right to purchase any
one share of Common Stock hereunder being an “Option”) to purchase from the
Company 34,963
shares of Common Stock.  The Options
shall have an exercise price of $9.00
per share, which is not less than the Fair Market Value per share of the Common
Stock as of the date hereof.  Each of the
Options granted pursuant to this Section 1 shall constitute Incentive
Common Stock Options to the extent permissible under Section 422 of the
Code and the Plan.


 


2.             Limitations on
Exercise of Options.  Subject to the
terms and conditions set forth herein and the Plan, the Options shall vest and
become exercisable, on a cumulative basis, with respect to 40% of the shares on
December 18, 2005, and with respect to 1.667% of the shares on the last
day of each succeeding calendar month thereafter so long as the Participant
continues in the Service of the Company; provided, however, the Participant may
not exercise any Option for fractional shares of Common Stock.  The Committee or the Board may accelerate the
vesting and exercisability of any or all of the then-unvested Options at any
time.


 


3.             Termination of
Service.  (a) If, prior to the
Expiration Date, the Participant’s Service with the Company shall terminate
(the date of termination being the “Date of Termination”) by reason of a Normal
Termination (as defined in the Plan), the Options shall remain exercisable
until the earlier of the Expiration Date or the day three (3) months after
the Date of Termination to the extent the Options were vested and exercisable
as of the Date of Termination.


 


(b)           If the Participant’s
Service with the Company shall cease prior to the Expiration Date by reason of
death or disability, or the Participant shall die or become disabled while
entitled to exercise any of the Options pursuant to paragraph 3(a), the
Participant or the Participant’s legal representative, or, in the case of
death, the executor or administrator of the estate of the Participant or the
person or persons to whom the Options shall have been validly transferred by
the executor or administrator pursuant to


 





















 


will or the laws of descent and
distribution, shall have the right, until the earlier of the Expiration Date or
one year after the date of death or disability, to exercise the Options to the
extent that the Participant was entitled to exercise them on the date of death
or disability.


 


(c)           If, prior to the
Expiration Date, the Participant’s Service with the Company is terminated for “Cause”
(as defined in the Plan), (i) unless otherwise provided by the Committee,
the Options, to the extent not exercised as of the Date of Termination, shall
lapse and be canceled, and (ii) all shares of Common Stock received
pursuant to an exercise of the Options after such termination, in contravention
of subsection (i) above, may be purchased by the Company at its
discretion for the exercise price of such shares paid by the Participant.  If the Participant’s Service relationship
with the Company is suspended pending an investigation of whether the
Participant shall be terminated for Cause, all the Participant’s rights with
respect to the Options shall be suspended during the period of investigation.


 


(d)           If, prior to the
Expiration Date, the Participant’s Service with the Company is terminated other
than for Cause, a Normal Termination, death or disability, the Options, to the
extent then vested and exercisable as of the Date of Termination, shall remain
exercisable until the earlier of the Expiration Date or thirty (30) days after
the Date of Termination.


 


(e)           After the expiration of
any exercise period described in any of Sections 3(a) - (d) hereof,
or otherwise upon the Expiration Date, the Options shall terminate together
with all of the Participant’s rights hereunder, to the extent not previously
exercised.


 


4.             Non-Transferable.  Except as specifically authorized by the
Committee, the Participant may not transfer the Options except by will or the
laws of descent and distribution and the Options shall be exercisable during
the Participant’s lifetime only by the Participant or, in the event of the
Participant’s legal incapacity, his guardian or legal representative.  Except as so authorized, no purported
assignment or transfer of the Options, or of the rights represented thereby,
whether voluntary or involuntary, by operation of law or otherwise (except by
will or the laws of descent and distribution), shall vest in the assignee or
transferee any interest or right herein whatsoever.


 


5.             Adjustments and
Corporate Reorganizations; Changes in Organization.


 


(a)           In accordance with and
subject to the applicable terms of the Plan and this Agreement, the Options
shall be subject to adjustment or substitution, as determined by the Committee
in its sole discretion, as to the number, price or kind of Common Stock or
other consideration subject to such Options or as otherwise determined by the
Committee in its sole discretion to be equitable (i) in the event of
changes in the outstanding Common Stock or in the capital structure of the
Company by reason of stock dividends, stock splits, reverse stock splits,
recapitalizations, reorganizations, mergers,


 





















 


consolidations, combinations,
exchanges, or other relevant changes in capitalization occurring after the date
hereof or (ii) in the event of any change in applicable laws or any change
in circumstances which results in or would result in any substantial dilution
or enlargement of the rights granted to, or available for, the
Participant.  The Committee shall give
the Participant written notice of an adjustment hereunder.


 


(b)           In
the event that the Company undertakes a change in its organization, including
but not limited to a combination of business units, the creation of a new
business unit, the elimination of a business unit, or the acquisition, sale or
transfer of an interest in a business unit, the Options shall be subject to
adjustment or substitution (including but not limited to the substitution of
common stock of or other ownership interest in a Related Entity, other
consideration or another Award under the Plan), as to the number, price or kind
of Common Stock or other consideration subject to such Options or as otherwise
determined by the Committee in its sole discretion to be equitable.  For purposes of this Agreement, a “business
unit” shall mean any Related Entity or any division or other unit or group
within the Company that the Committee designates as a “business unit”.


 


(c)           Subject to the provisions of Section 13(b) of
the Plan, in the event of a Corporate Transaction (as defined below), if the
Options evidenced by this Agreement are not assumed or continued or a
substantially equivalent option or right is not substituted by the surviving
corporation, the successor corporation or its parent corporation, as applicable
(the “Successor Corporation”), the Participant shall, as of the date of the
Corporate Transaction, fully vest in and have the right to exercise such
Options as to all shares of Common Stock then subject thereto that would
otherwise have vested and become exercisable during the twelve-month period
commencing on the date of the Corporate Transaction and, subject to the next
sentence, unvested Options with respect to any other shares of Common Stock
shall continue to vest as set forth in Section 2.   If any Options evidenced by this Agreement
are assumed or replaced (and any such Options shall be considered assumed if
the Company in a Corporate Transaction reaffirms the Options) in connection
with a Corporate Transaction and do not otherwise vest at that time, and if
Participant’s Service with the Company is subsequently terminated within one (1) year
following such Corporate Transaction, unless such Service is terminated by the
Successor Corporation for Cause or by the Participant voluntarily without Good
Reason (as defined below), the Participant shall fully vest in and have the
right to exercise the Options as to all shares of Common Stock then subject
thereto that, but for such termination, would have otherwise vested and become
exercisable during the twelve-month period commencing on the effective date of
such termination, and unvested Options with respect to any other shares of Common
Stock shall continue to vest as set forth in Section 2.


 


(d)           For
purposes of this Agreement, a “Corporate Transaction” shall mean any of the
following events:


 


(i)            The consummation of
any merger or consolidation of the Company in which the Company is not the
continuing or surviving corporation, or pursuant to which shares of Common
Stock are converted into cash, securities or other


 





















 


property, if following such merger or
consolidation the holders of the Company’s outstanding voting securities
immediately prior to such merger or consolidation own less than a majority of
the outstanding voting securities of the surviving corporation.


 


(ii)           The consummation of any
sale, lease, exchange or other transfer in one transaction or a series of
related transactions of all or substantially all of the Company’s assets, other
than a transfer of the Company’s assets to a majority-owned subsidiary of the
corporation.


 


(iii)          The approval by the
holders of the Common Stock of any plan or proposal for the liquidation or dissolution
of the Company.


 


(iv)          The acquisition by a
person, within the meaning of Section 3(a)(9) or of Section 13
(d)(3) (as in effect on the date of adoption of the Plan) of the Exchange
Act of a majority or more of the Company’s outstanding voting securities
(whether directly or indirectly, beneficially or of record), other than a
person who held such majority on the date of adoption of the Plan.  Ownership of voting securities shall take
into account and shall include ownership as determined by applying Rule 13d-3(d)(1)(i) (as
in effect on the date of adoption of the Plan) pursuant to the Exchange Act.


 


(e)           For
purposes of this Agreement, “Good Reason” shall mean, without the Participant’s
prior written consent, any of the following events or conditions and the
failure of the Successor Corporation to cure such event or condition within
thirty (30) days after receipt of written notice from the Participant:


 


(i)            A substantial
diminution or material adverse change in the Participant’s status, title, position,
authority, duties or responsibilities (including reporting responsibilities) as
in effect immediately prior to a Corporate Transaction, except in connection
with the Participant’s termination of Service with the Company for Cause,
disability, death or by the Participant other than for Good Reason.


 


(ii)           A reduction in the
Participant’s annual base salary.


 


(iii)          The Successor
Corporation’s failure to cover the Participant under employee benefit plans,
programs and practices that, in the aggregate, provide substantially comparable
benefits (from an economic perspective) to the Participant relative to the
benefits and total costs under the material employee benefit plans, programs
and practices in which the Participant (and/or his family or dependents) is
participating immediately preceding the Corporate Transaction.


 


(iv)          The Successor
Corporation’s requiring the Participant to be based at any office location that
is more than fifty (50) miles further from the Participant’s office location
immediately prior to a Corporate Transaction; except for reasonable required
travel for the Successor Corporation’s business that is not


 





















 


materially greater than such travel
requirements prior to such Corporate Transaction.


 


(v)           A material breach by
the Successor Corporation of its obligations to the Participant under the Plan.


 


6.             Exercise; Payment
For and Delivery of Common Stock. 
The Options shall be exercised by delivering written notice to the
Committee stating the number of whole shares of Common Stock to be purchased,
the person or persons in whose name the shares of Common Stock are to be
registered and each such person’s address and social security number.  Such notice shall not be effective unless
accompanied by the full purchase price for all shares to be purchased, and any
applicable withholding (as described below). 
The purchase price shall be payable in cash, in shares of Common Stock,
any combination of cash or shares of Common Stock or such other method of
payment as is authorized by the Plan with the consent of the Committee; provided,
however, that the Participant may use Common Stock in payment of the
exercise price only if the shares so used are considered “mature” for purposes
of generally accepted accounting principles (i.e., (i) been held by
the Participant free and clear for at least six (6) months prior to the
use thereof to pay part of an Option exercise price, (ii) been purchased
by the Participant in other than a compensatory transaction, or (iii) meet
any other requirements for “mature” shares as may exist on the date of the use
thereof to pay part of an Option exercise price).  In the event that all or part of the purchase
price is paid in shares of Common Stock, the shares used in payment shall be
valued at their Fair Market Value on the date of exercise of the Options.  At the time of exercise, the Participant
shall pay to the Company, in cash, or by having the Company withhold upon
exercise of the Option a sufficient number of shares of Common Stock otherwise
deliverable to the Participant based on the Fair Market Value of the Common
Stock on the date of exercise, at the election of the Participant, such minimum
amount as the Company deems necessary to satisfy its obligation to withhold
Federal, state or local income or other taxes incurred by reason of the
exercise or the transfer of shares thereupon. 
Payment in currency or by certified or cashier’s check shall be
considered payment in cash.


 


7.             Rights as Common
Stockholder.  The Participant or a
transferee of the Options shall have no rights as a stockholder with respect to
any shares covered by the Options until he or she shall have become the holder
of record of such shares (and the Company shall use its reasonable best efforts
to cause the Participant promptly to become the holder of record of such
shares), and, except as provided in Section 5 hereof, no adjustment shall
be made for dividends or distributions or other rights in respect of such
shares for which the record date is prior to the date upon which he shall
become the holder or record thereof.


 


8.             Company;
Participant.  (a) The term “Company”
as used in this Agreement with reference to employment shall include the
Company and its affiliates.


 


(b)           Whenever the word “Participant”
is used in any provision of this Agreement under circumstances where the
provision should logically be construed to apply to the executors, the
administrators, legal representatives or the person or persons


 





















 


to whom the Options may be
transferred by will or by the laws of descent and distribution, the word “Participant”
shall be deemed to include such person or persons.


 


9.             Requirements of
Law.  (a)  By accepting the
Options, the Participant represents and agrees for himself and his transferees
(whether by will or the laws of descent and distribution) that, unless a
registration statement under the Securities Act of 1933, as amended (the “Act”),
is in effect as to shares purchased upon any exercise of the Options, (i) any
and all shares so purchased shall be acquired for his or her personal account
and not with a view to or for sale in connection with any distribution, and (ii) each
notice of the exercise of any portion of this Option shall be accompanied by a
representation and warranty in writing, signed by the person entitled to
exercise the same, that the shares are being so acquired in good faith for his
personal account and not with a view to or for sale in connection with any
distribution.


 


(b)           No certificate or
certificates for shares of Common Stock may be purchased, issued or transferred
if the exercise hereof or the issuance or transfer of such shares shall
constitute a violation by the Company or the Participant of any (i) provision
of any Federal, state or other securities law, (ii) requirement of any
securities exchange listing agreement to which the Company may be a party, or (iii) other
requirement of law or of any regulatory body having jurisdiction over the
Company.  Any reasonable determination in
this connection by the Board or the Committee, upon notice given to the
Participant, shall be final, binding and conclusive.


 


(c)           The certificates
representing shares of Common Stock acquired pursuant to the exercise of
options shall carry such appropriate legend, and such written instructions
shall be given to the Company’s transfer agent, as may be deemed necessary or
advisable by counsel to the Company in order to comply with the requirements of
the Act or any state securities laws.


 


10.           Notices.  Any notice to be given to either party shall
be in writing and shall be given by hand delivery to such party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed to the Company in care of its Secretary at its principal office, and
to the Participant at the address given beneath his signature hereto, or at
such other address as either party shall have furnished to the other in writing
in accordance herewith.  Notice and
communications shall be effective when actually received by the addressee.


 


11.           Disposition of
Common Stock.  The Participant agrees
to notify the Company, in writing, within thirty (30) days of any disposition
(whether by sale, exchange, gift or otherwise) of shares of Common Stock
purchased under this Agreement.


 


12.           Binding Effect.  Subject to Section 4 hereof, this
Agreement shall be binding upon the heirs, executors, administrators,
successors and permitted assigns of the parties hereto.


 


13.           Plan.  The terms and provisions of the Plan are
incorporated herein by reference and made a part hereof as though fully set
forth herein.  In the event of any conflict
or inconsistency between discretionary terms and provisions of this Agreement,
this Agreement shall govern and control. 
In all


 





















 


other instances of conflicts or
inconsistencies or omissions, the terms and provisions of the Plan shall govern
and control.  All capitalized terms not
otherwise expressly defined in this Agreement shall have the meaning ascribed
to them in the Plan.


 


14.           Governing Law.  This Agreement shall be construed and
interpreted in accordance with the laws of the State of Delaware, without
regard to the principles of conflicts of law thereof.


 


15.           Entire Agreement.  This Agreement, together with the Plan,
contains the entire agreement and understanding between the parties with
respect to the subject matter hereof and supersedes all prior agreements,
written or oral, with respect thereto.


 


IN WITNESS WHEREOF, the Company has granted this Option on the
Effective Date.


 


This instrument may be executed in any number of counterparts, each of
which shall be deemed to be an original, and such counterparts together shall
constitute one and the same instrument.


 


	
   

  	
  NEUSTAR, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ Jeffrey Ganek

  	
   

  
	
   

  	
   

  	
  Jeffrey Ganek

  
	
   

  	
   

  	
  Chairman and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  ACCEPTED:

  	
   

  
	
   

  	
   

  
	
  /s/ John Malone

  	
   

  	
   

  
	
  John Malone