Exhibit
10.3


 


Model Form of Stock Option Agreement for
non-employee directors under the 2004 Stock Option & Stock Issuance
Plan.  Pursuant to Section 3 of the Plan,
the stock option agreements need not be uniform and accordingly Stock Option
Agreements to certain non-employee directors may vary from this Model Form.


 


THIS OPTION IS NOT, AND SHALL NOT BE TREATED AS AN INCENTIVE STOCK
OPTION, AS DEFINED IN SECTION 422 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED.


 


HEALTHGATE
DATA CORP.


STOCK
OPTION AGREEMENT


 


                THIS
STOCK OPTION AGREEMENT is entered into by and between HealthGate Data Corp., a
Delaware corporation (the “Company”), and __________ (“Optionee”).


W I  T  N
E  S  S  E  T  H:


                WHEREAS,
the Company has a 2004 Stock Option & Stock Issuance Plan pursuant to which
stock options may be granted (the “2004 Stock Option Plan”); and


                WHEREAS,
in lieu of other compensation to non-employee directors, the Optionee and the
Company desire to grant stock options to the non-employee directors of the
Company;


                WHEREAS, the Company and Optionee
desire to enter into this Agreement concerning the grant by the Company of
stock options to Optionee, pursuant to the 2004 Stock Option Plan;


                NOW,
THEREFORE, in consideration of the covenants herein set forth, the parties
agree as follows:


Shares; Price; Vesting; Term.  As of ______________ (the “Grant
Date”), the Company grants Optionee an option to purchase ______ shares of its
Common Stock, par value $0.03 per share (the “Option Shares”), at a price of
$______  per share (which price is at
least equal to the fair market value of the stock on the Grant Date, as
determined in good faith by the Board of Directors based on the closing price
quoted on the OTC-BB), pursuant to the Company’s 2004 Stock Option Plan, which
shall be exercisable according to the following schedule:


 




	
  Number of Shares 

  	
   

  	
  First Date

  of Exercise 

  	
   

  	
  Last Date

  of Exercise 

  	
   

  
	
  [Typically,
  the options vest quarterly over 3 years]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL:

  	
   

  	
   

  	
   

  	
   

  	
   

  






 


                                Subject
to earlier termination described herein, the Option shall terminate entirely at
the close of business on [Typically, 10 years after the Grant Date].__________.


 


 





















 


                2.             Accelerated Vesting.  Notwithstanding the foregoing, this Option
shall immediately become exercisable as to all Option Shares then subject
hereto in the event of a “Change in Control” (as hereinafter defined) of the
Company.


                As
used herein, a “Change in Control” of the Company shall be deemed to have
occurred if:


                                                (i)            there is a merger
or consolidation of the Company in which the Company is not the continuing or
surviving corporation;


                                                (ii)           the Company sells
substantially all its assets to a single purchaser or to a group of associated
purchasers;


                                                (iii)          at least two-thirds
of the outstanding common stock of the Company is sold, exchanged or otherwise
disposed of in one transaction or in a series of related transactions;


                                                (iv)          any person or entity
(other than any stockholder presently owning more than 10%) becomes directly or
indirectly the owner or beneficial owner of 50% or more of the Company’s
outstanding common stock;


                                                (v)           the Board of
Directors of the Company determines in its sole and absolute discretion that
there has been a change in control of the Company.


                3.             Exercise.  Optionee may exercise this Stock Option from
time to time as hereinabove provided, by delivery to the Company, as to each
such exercise, at its principal office of (a) written notice of exercise of
this Stock Option, stating the number of shares then being purchased hereunder;
(b) a check or cash in the amount of the full purchase price of such shares;
(c) a check or cash in the amount of federal, state and local withholding
taxes, if any, required to be withheld and paid by the Company as a result of
such exercise; and (d) such other documents or instruments as may be required
by any then applicable federal or state laws or regulations, or regulatory
agencies pertaining to this Stock Option, any exercise thereof and/or any
offer, issue, sale or purchase of any shares covered by this Stock Option.  Not less than one share may be purchased at
one time.  After the Company shall have
received all of the foregoing, the Company shall proceed with reasonable
promptness to issue the shares so purchased upon such exercise of the Stock
Option; provided, however, that Optionee or any person or persons entitled to
exercise this Option under Section 5 hereof shall not be or be deemed to be the
record or beneficial owner of any such shares purchased upon any exercise of
this Stock Option until and unless the stock certificate or certificates
evidencing such shares actually shall have been issued.  Except as provided in Sections 4 and 5
hereof, Optionee may exercise this Stock Option only if, on the date of
exercise, Optionee has been continuously a Director of the Company since the
Grant Date.


                4.             Termination of Service
as a Director.  Notwithstanding the
provisions of Section 3 hereof, if Optionee shall cease to be a Director of the
Company for any reason other than Optionee’s death, Optionee may 


 


 





















 


only exercise this Stock Option (to the extent he
or she was entitled to do so at the termination of service) at any time and
from time to time within three (3) months after such termination, but in no
event after the expiration of this Stock Option; provided, however, that if the
service as a Director terminates due to the permanent and total disability of
Optionee, Optionee may exercise this Stock Option (to the extent Optionee was
entitled to do so at the termination of Optionee’s service as a Director) only
at any time and from time to time within twelve 
(12) months after such termination, but in no event after the expiration
of this Stock Option.  No provision of
the 2004 Stock Option Plan or this Stock Option shall confer any right to
continue as a Director of the Company or interfere in any way with the right of
the Company to terminate service as a Director at any time.


                5.             Death of Optionee; No Assignment.  This Stock Option shall not be assignable or
transferable except by will or by the laws of descent and distribution and
shall be exercisable during Optionee’s lifetime only by Optionee.  If Optionee shall die while serving as a
director of the Company, Optionee’s personal representative or the person
entitled to succeed to his or her rights hereunder shall have the right, at any
time and from time to time within three (3) months after the date of Optionee’s
death, and prior to the expiration or termination of this Stock Option pursuant
to Section 1 hereof, to exercise this Stock Option to the extent that Optionee
was entitled to exercise this Stock Option at the date of Optionee’s death.


                6.             No Rights as Stockholder.  Optionee shall have no rights as a
stockholder with respect to the Common Stock covered by this Stock Option until
the date of the issuance of a stock certificate or stock certificates to
Optionee.  No adjustment will be made for
dividends or other rights for which the record date (or if there is no record
date established, then the date established for the distribution of such
dividend or right) is prior to the date such stock certificates are issued.


                7.             Conditions of Resale.  Optionee agrees to comply with all applicable
federal and state securities laws and rules and regulations thereunder in
connection with the resale of any shares of Common Stock which shall have been
received upon exercise of this Option, and Optionee further agrees to comply
with all requirements of the Company with respect to the timing of such resale
which may be reasonably imposed by the Company as conditions of such resale.  Optionee will, as a condition to exercise of
the Option, enter into an agreement with the Company pursuant to which the
Company shall have a right of first refusal with respect to the transfer of the
Option Shares.  Such agreement shall be
in the form acceptable to the Company and may include other provisions
concerning transfer or voting of the Option Shares which are applicable to
other stockholders of the Company.  The
Company may, in its discretion, place a legend on stock certificates issued in
connection with the exercise of this Stock Option in order to insure compliance
with the Securities Act of 


 


 


 





















 


1933, as amended and the Stockholders’ Agreement.


                8.             Adjustments for Stock Splits,
etc.  In the event of any change in
the outstanding Common Stock of the Company by reason of a stock dividend,
recapitalization, merger, consolidation, stock split, combination or exchange
of shares, or the like, the number and class of shares available under this
Agreement and the Stock Option prices and other terms and conditions may be
appropriately adjusted by the Board of Directors of the Company, as described in
the 2004 Stock Option Plan, whose
determination shall be conclusive.


                9.             This Agreement Subject to 2004
Stock Option Plan.  This
Agreement is made pursuant to all of the provisions of the 2004 Stock Option
Plan, and is intended, and shall be interpreted in a manner, to comply
therewith.  Any provision hereof
inconsistent with the 2004 Stock Option Plan shall be superseded and governed
by the 2004 Stock Option Plan.


                10.           Miscellaneous.  Section and other headings are included
herein for reference purposes only and shall not be construed or interpreted as
part of this Agreement.


                Wherever
and whenever the context of this Agreement shall so require, the masculine,
feminine and neuter gender of any noun or pronoun shall include any or all of
the other genders and the singular shall include the plural and the plural
shall include the singular.


                Optionee
understands that this Stock Option thus will not be treated as an “Incentive
Stock Option” pursuant to Section 422 of the Internal Revenue Code of 1986.


                This
Agreement may be executed in several counterparts, all of which shall
constitute one and the same instrument.


                IN
WITNESS WHEREOF, the parties hereto have executed this Agreement to be
effective ___________ .


 


	
   

  	
  HEALTHGATE DATA CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Optionee