EX-10.2



 





	 	 	 
	

	 	Exhibit 10.2







AETNA INC.

2000 STOCK INCENTIVE PLAN




NONSTATUTORY STOCK OPTION

TERMS OF AWARD




Pursuant to its 2000 Stock Incentive Plan, Aetna Inc. has granted an option to
purchase shares of Common Stock. The number of shares represented by this
option, the option price and vesting information is included on the website of
the designated broker, currently UBS Financial Services, Inc.
(www.ubs.com/cefs/aet). You should view this information and print the detail
for your personal records. Such option is issued on the terms and conditions
hereinafter set forth.




ARTICLE I




DEFINITIONS





	(a)	 	“Affiliate” means an entity at least a majority of the total voting power
of the then-outstanding voting securities of which is held, directly or
indirectly, by the Company and/or one or more other Affiliates.
	 
	(b)	 	“Board” means the Board of Directors of Aetna Inc.
	 
	(c)	 	“Change in Control” means the happening of any of the following:






	 	(i)	 	When any “person” as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) and as used in
Sections 13(d) and 14(d) thereof, including a “group” as defined in
Section 13(d) of the Exchange Act but excluding the Company and any
Subsidiary thereof and any employee benefit plan sponsored or
maintained by the Company or any Subsidiary (including any trustee of
such plan acting as trustee), directly or indirectly, becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act,
as amended from time to time), of securities of the Company
representing 20 percent or more of the combined voting power of the
Company’s then outstanding securities;
	 
	 	(ii)	 	When, during any period of 24 consecutive months, the individuals
who, at the beginning of such period, constitute the Board (the
“Incumbent Directors”) cease for any reason other than death to
constitute at least a majority thereof, provided that a director who
was not a director at the beginning of such 24-month period shall be
deemed to have satisfied such 24-month requirement (and be an
Incumbent Director) if such director was elected by, or on the
recommendation of or with the approval of, at least two-thirds of the
directors who then qualified as Incumbent Directors either actually
(because they were directors at the beginning of such 24-month period)
or by prior operation of this paragraph (ii); or




 









 






	 	(iii)	 	The occurrence of a transaction requiring stockholder approval
for the acquisition of the Company by an entity other than the Company
or a Subsidiary through purchase of assets, or by merger, or
otherwise.






	 	 	Notwithstanding the foregoing, in no event shall a “Change in Control” be
deemed to have occurred (i) as a result of the formation of a Holding
Company, or (ii) with respect to Grantee, if Grantee is part of a “group,”
within the meaning of Section 13(d)(3) of the Exchange Act as in effect on
the effective date, which consummates the Change in Control transaction.
In addition, for purposes of the definition of “Change in Control” a person
engaged in business as an underwriter of securities shall not be deemed to
be the “beneficial owner” of, or to “beneficially own,” any securities
acquired through such person’s participation in good faith in a firm
commitment underwriting until the expiration of forty days after the date
of such acquisition.
	 
	(d)	 	“Committee” means the Board’s Committee on Compensation and Organization
or any successor thereto.
	 
	(e)	 	“Common Stock” means shares of the Company’s Common Stock, $.01 per
share.
	 
	(f)	 	“Company” means Aetna Inc.
	 
	(g)	 	“Disability” means long-term disability as defined under the terms of the
Company’s applicable long-term disability plans or policies.
	 
	(h)	 	“Fair Market Value” means the closing price of the Common Stock as
reported by the Consolidated Tape of the New York Stock Exchange Listed
Shares on the date such value is to be determined, or, if no shares were
traded on such day, on the next day on which the Common Stock was traded.
	 
	(i)	 	“Fundamental Corporate Event” shall mean any stock dividend,
extraordinary cash dividend, recapitalization, reorganization, merger,
consolidation, split-up, spin-off, combination, exchange of shares,
warrants or rights offering to purchase Common Stock at a price
substantially below fair market value, or similar event.
	 
	(j)	 	“Grantee” means the person to whom this Option has been granted.
	 
	(k)	 	“Holding Company” means an entity that becomes a holding company for the
Company or its businesses as a part of any reorganization, merger,
consolidation or other transaction, provided that the outstanding shares
of common stock of such entity and the combined voting power of the then
outstanding voting securities of such entity entitled to vote generally in
the election of directors is, immediately after such reorganization,
merger, consolidation or other transaction, beneficially owned, directly
or indirectly, by all or substantially all of the individuals and entities
who were the beneficial owners, respectively of the voting stock
outstanding immediately prior to such reorganization, merger,
consolidation or other transaction in substantially the same proportions
as their ownership, immediately prior to such reorganization, merger,
consolidation or other transaction, of such outstanding voting stock.
	 
	(l)	 	“Option Date” means the date of grant of this Option, approved by the
Committee.
	 
	(m)	 	“Option” means the option granted to the Grantee.




 









 






	(n)	 	“Options Granted” means the number of shares of Common Stock represented
by the Option, or such other amount as may result by operation of Article
IV of this Agreement.
	 
	(o)	 	“Option Price” means the amount per share of Common Stock required to be
paid upon the exercise of the Option, or such other amount per share of
Common Stock as may result by operations of Article IV of this Agreement.
	 
	(p)	 	“Options Vested” means number of shares exercisable at any given date.
	 
	(q)	 	“Plan” means the Aetna Inc. 2000 Stock Incentive Plan.
	 
	(r)	 	“Retirement” means the termination of employment of a Grantee from active
service with the Company, a Subsidiary or Affiliate provided the Grantee’s
age and completed years of service total 65 or more points at termination.
	 
	(s)	 	“Shares granted” means a portion of the Options granted that have a
future vesting schedule.
	 
	(t)	 	“Shares of Stock” or “Stock” means the Common Stock.
	 
	(u)	 	“Subsidiary” means any entity of which, at the time such subsidiary
status is to be determined, at least 50% of the total combined voting
power of all classes of stock in such entity is held by the Company and
its Subsidiaries (exclusive of ownership by the entity whose subsidiary
status is being determined).
	 
	(v)	 	“Successor” means the legal representative of the estate of a deceased
Grantee or the person or persons who shall acquire the right to exercise
an Option by bequest or inheritance or by reason of the death of the
Grantee.
	 
	(w)	 	“Term” means the period during which the Option may be exercised.
	 
	(x)	 	“Vest Date” means the date on which options vested are exercisable.





ARTICLE II




TERM OF OPTION AND EXERCISE





	(a)	 	The Term of the Option shall commence on [date] and shall terminate,
unless sooner terminated by the terms of the Plan or this Agreement, at:






	 	(i)	 	The close of the Company’s business on the day preceding the
tenth anniversary of the Option Date, if the Company is open for
business on such day; or
	 
	 	(ii)	 	The close of the Company’s business on the next preceding day
that the Company is open for business.




 









 












	(b)	 	The Option is exercisable in [number] equal Installment[s], each
installment to become exercisable on [date]. Once an option is vested, it
may be exercised in whole or in part only during the Term of the Option.





ARTICLE III




METHOD OF OPTION EXERCISE




In order to exercise this Option, Grantee must comply with procedures adopted
by the Company from time to time. Under current procedures, the Grantee must
exercise options through the Company’s designated broker.




In addition, if the Grantee has been notified that he or she must consult with
a member of the Company’s Law Department prior to engaging in transactions in
Aetna stock, Grantee must consult with the Law Department prior to exercising
the Option.




Certain designated Grantees may elect to exercise the Option, in whole or in
part, by delivering previously owned shares of Common Stock having a Fair
Market Value on the date of exercise equal to the portion of the exercise price
the Grantee intends to pay with such shares. If the Grantee surrenders shares
of previously owned Common Stock to exercise the Option, in whole or in part,
the Grantee may defer the receipt of that number of shares of Common Stock
issuable upon such exercise which is in excess of the number of shares
delivered by the Grantee to exercise the Option. The number of shares issuable
pursuant to the exercise of the Option that is equal to the number of shares
surrendered to exercise the option shall be issued to the Grantee regardless of
any deferral election.




To effect such a deferral, the Grantee must file a written election, in
accordance with procedures adopted by the Company from time to time. Upon any
exercise of the Option with a deferred delivery of shares, the Company shall
establish an unfunded book entry account in the name of the Grantee to which it
shall notionally credit the number of shares whose delivery has been delayed.
During any such deferral period, a Grantee shall have no rights as a
shareholder with respect to such deferred shares; provided, however, that there
shall be credited to such account any dividends and distributions (including,
without limitation, any dividends or distributions payable in Common Stock)
that are made on a corresponding number of outstanding shares of Common Stock,
and each such dividend or distribution so credited shall be deemed reinvested
in additional shares of Common Stock based on the Fair Market Value on the date
such dividend or distribution is paid or delivered to shareholders (“Dividend
Equivalents”). Amounts credited to the Grantee’s account in respect of
Dividend Equivalents shall be distributed to the Grantee at the same time as
the underlying deferred shares are distributed.




 









 








ARTICLE IV




CAPITAL CHANGES




In the event that the Committee shall determine that any Fundamental Corporate
Event affects the Common Stock such that an adjustment is required to preserve,
or to prevent enlargement of, the benefits or potential benefits made available
under this Plan, then the Committee shall, in such manner as the Committee may
deem equitable, adjust the (i) the number and kind of shares subject to the
Option or (ii) the Option Price. Additionally, the Committee may make
provision for a cash payment to a Grantee or the Successor of the Grantee in
satisfaction of all or any portion of the Option. The number of Shares of
Stock subject to the Option shall always be a whole number.




ARTICLE V




CHANGE IN CONTROL




Upon the occurrence of a Change in Control, each unvested option shall become
vested and immediately exercisable and shall be exercisable in accordance with
the terms of this Agreement; provided, however, that, notwithstanding anything
contained in this Agreement to the contrary, if, after a Change in Control,
outside legal counsel selected by the Company shall determine that, on the last
date on which the Grantee could otherwise exercise the Option, the Grantee can
not sell the underlying stock in an open market transaction due to the
Grantee’s access to material nonpublic information pertaining to the Company or
any of its Subsidiaries, the Grantee may exercise the Option at any time up to
the later to occur of (i) the fifth business day following notice from outside
legal counsel that such counsel no longer believes that the Grantee is
precluded from selling such underlying shares in the market, or (ii) the date
which is six months from the date on which the Grantee’s employment with the
Company and each of its Subsidiaries terminates, but in no event later than the
expiration of the Term of the Option.




ARTICLE VI




TERMINATION OF OPTION





	(a)	 	Except as provided in (e) below, if the Grantee shall cease, for reason
of death or Disability to be employed by the Company, its Subsidiaries or
Affiliates during the Term of the Option, the option shall become vested
and immediately exercisable and the Grantee or Successor of the Grantee
may exercise the Option until the earlier of:






	 	(i)	 	The expiration of the Term of the Option; or
	 
	 	(ii)	 	A period not to exceed five years following such cessation of
employment.






	(b)	 	Except as provided in (e) below, if Grantee shall cease for reason of
Retirement to be employed by the Company, its Subsidiaries or Affiliates
during the Term of the Option, the Grantee may continue to vest in the
Option (unless the Grantee commences work for a Competitor not approved




 









 






	 	 	in advance in writing by the Company in which case the unvested Option will
immediately terminate) and the Grantee or Successor of the Grantee may
exercise the Option until the earlier of:






	 	(i)	 	The expiration of the Term of the Option; or
	 
	 	(ii)	 	A period not to exceed five years following such cessation of
employment.






	 	 	For purposes of this Article VI (b) the term “Competitor” shall mean any
company or organization that develops, administers, operates, offers or
solicits offers regarding managed care, health, life, long-term case or
disability coverages, networks, insurance or plans to employers, employees
or individuals.
	 
	(c)	 	Except as provided in (d) and (e) below, if the Grantee shall cease, for
a reason other than death, Disability or Retirement, to be employed by the
Company, its Subsidiaries or Affiliates during the Term of the Option, the
Grantee may exercise a vested Option until the earlier of:






	 	(i)	 	The expiration of the Term of the Option; or
	 
	 	(ii)	 	A period not to exceed ninety days following such cessation of
employment.






	(d)	 	Except as provided in (a) or (b) above, any Option, or portion of an
Option that has not become vested and exercisable at the time of cessation
of employment shall terminate immediately upon such cessation of
employment and may not be exercised thereafter.
	 
	(e)	 	No Option may be exercised after the Company has terminated the
employment of the Grantee for cause, except that the Committee may, in its
sole discretion, permit exercises for a period of up to ninety days in
cases where such period shall be deemed warranted under the particular
circumstances.
	 
	(f)	 	If the Grantee shall die after termination of employment, such
termination being for a reason other than Disability or Retirement, but
while the Option is still in effect and such termination occurs after the
Term of the Option has commenced, a vested Option may be exercised by the
Successor of the Grantee until the earlier of:






	 	(i)	 	The expiration of the Term of the Option; or
	 
	 	(ii)	 	One year from the date of termination of employment of the
Grantee.






	(g)	 	Employment for purposes of determining the post-employment exercise
rights of the Grantee under this Article VI shall mean continuous
full-time salaried employment with the Company, a Subsidiary or an
Affiliate, except that the period during which the Grantee is on vacation,
sick leave, or other approved absence, or in receipt of severance pay
shall not interrupt the continuous employment of the Grantee.
	 
	(h)	 	Except as otherwise herein provided, exercise of the Option, whether by
the Grantee or the Successor of the Grantee, shall be subject to all terms
and conditions of this Agreement.





ARTICLE VII




 









 








OTHER TERMS





	(a)	 	Grantee understands that the Grantee shall not have any rights as
stockholder by virtue of the grant of an Option but only with respect
to shares of Common Stock actually issued to the Grantee in accordance with
the terms hereof.
	 
	(b)	 	Anything herein to the contrary notwithstanding, the Company may postpone
the exercise of the Option or any portion thereof for such time as the
Committee in its discretion may deem necessary, in order to permit the
Company with reasonable diligence (i) to effect or maintain registration
under the Securities Act of 1933, as amended, of the Plan or the shares of
Common Stock issuable upon the exercise of the Option, or (ii) to
determine that the Plan and such shares are exempt from registration; and
the Company shall not be obligated by virtue of this Option Agreement or
any provision of the Plan to recognize the exercise of the Option or to
sell or issue shares of Common Stock in violation of said Act or of the
law of any government having jurisdiction thereof. Any such postponement
shall not extend the Term of the Option; and neither the Company nor its
Board shall have any obligation or liability to the Grantee, or to the
Grantee’s Successor, with respect to any shares of Common Stock as to
which the Option shall lapse because of such postponement.
	 
	(c)	 	The Option shall be nontransferable and nonassignable except by will and
by the laws of descent and distribution. During the Grantee’s lifetime,
the Option may be exercised only by the Grantee.
	 
	(d)	 	The Option is not an incentive stock option as described in the Internal
Revenue Code of 1986, as amended, Section 422A (b).
	 
	(e)	 	This Agreement is subject to the 2000 Stock Incentive Plan heretofore
adopted by the Company and approved by its shareholders. The terms and
provisions of the Plan (including any subsequent amendments thereto) are
hereby incorporated herein by reference. In the event of a conflict
between any term or provision contained herein and a term or provision of
the Plan, the applicable terms and provisions of the Plan will govern and
prevail.
	 
	(f)	 	Anything herein to the contrary notwithstanding, a Grantee whose option
has been forfeited as a result of termination of employment due to U.S.
Military Service and who is later re-employed (in a full-time active
status) after discharge within the time period set in 38 U.S.C. Section
4312 will be eligible to have the forfeited Options reinstated for the
original Term pursuant to procedures established by the Company for this
purpose.




 









 











ARTICLE VIII




EMPLOYEE COVENANTS





	(a)	 	As consideration for the grant of the Option, without prior written
consent of the Company:






	 	(i)	 	Grantee will not (except to the extent required by an order of a
court having competent jurisdiction or under subpoena from an
appropriate government agency) disclose to any third person, whether
during or subsequent to Grantee’s Employment, any trade secrets,
confidential information and proprietary materials, which may include,
but are not limited to, the following categories of information and
materials: customer lists and identities; provider lists and
identities; employee lists and identities; product development and
related information; marketing plans and related information; sales
plans and related information; premium or other pricing information;
operating policies and manuals; research; payment rates;
methodologies; procedures; contractual forms; business plans;
financial records; computer programs; database; or other financial,
commercial, business or technical information related to the Company
or any Subsidiary or Affiliate unless such information has been
previously disclosed to the public by the Company or has become public
knowledge other than by a breach of this Agreement; provided, however,
that this limitation shall not apply to any such disclosure made while
Grantee is employed by the Company, any Subsidiary or Affiliate if
such disclosure occurred in connection with the performance of
Grantee’s job as an employee of the Company, any Subsidiary or
Affiliate;
	 
	 	(ii)	 	Grantee will not, during and for a period of 12 months following
Grantee’s termination of Employment, directly or indirectly induce or
attempt to induce any employee to be employed by or to perform
services elsewhere;
	 
	 	(iii)	 	Grantee will not, during and for a period of 12 months following
Grantee’s termination of Employment, directly or indirectly, induce or
attempt to induce any agent or agency, broker, supplier or health care
provider of the Company or any Subsidiary to cease or curtail
providing services to the Company or any Subsidiary; and
	 
	 	(iv)	 	Grantee will not, during and for a period of 12 months following
Grantee’s termination of Employment, directly or indirectly solicit or
attempt to solicit the trade of any individual or entity which, at the
time of such solicitation, is a customer of the Company, any
Subsidiary or Affiliate, or which the Company, any Subsidiary or
Affiliate is undertaking reasonable steps to procure as a customer at
the time of or immediately preceding termination of Employment;
provided, however, that this limitation shall only apply to any
product or service which is in competition with a product or service
of the Company, any Subsidiary or Affiliate and shall apply only with
respect to a customer or prospective customer with whom the Grantee
has been directly or indirectly involved.






	 	 	In addition:






	 	(v)	 	Following the termination of Grantee’s Employment, Grantee shall
provide assistance to and shall cooperate with the Company or a
Subsidiary or Affiliate, upon its reasonable request and without
additional compensation, with respect to matters within the scope of
Grantee’s duties and responsibilities during Employment, provided that
any reasonable out-of-pocket




 









 






	 	 	 	expenses Grantee incurs in connection with any assistance Grantee has
been requested to provide under this provision for items including, but
not limited to, transportation, meals, lodging and telephone, shall be
reimbursed by the Company. The Company agrees and acknowledges that it
shall, to the maximum extent possible under the then prevailing
circumstances, coordinate, or cause a Subsidiary or Affiliate to
coordinate, any such request with Grantee’s other commitments and
responsibilities to minimize the degree to which such request
interferes with such commitments and responsibilities;
	 
	 	(vi)	 	Grantee shall promptly notify the Company’s General Counsel if
Grantee is contacted by a regulatory or self-regulatory agency with
respect to matters pertaining to the Company or by an attorney or
other individual who informs you that he/she has filed, intends to
file, or is considering filing a claim or complaint against the
Company; and
	 
	 	(vii)	 	Grantee acknowledges that all original works of authorship that
are made by Grantee (solely or jointly with others) within the scope
of Grantee’s employment which are protectable by copyright are “works
made for hire” as that term is defined in the United States Copyright
Act (17 U.S.C., Section 101). Grantee further acknowledges that while
employed by the Company, Grantee may develop ideas, inventions,
innovations, procedures, methods, know-how or other works which relate
to the Company’s current or reasonably expected to relate to the
Company’s future business that may be patentable. To the extent any
such works may be patentable, Grantee agrees that the Company may file
and prosecute any application for patents in Grantee’s name and that
Grantee will, on request, assign to the Company (and take all such
further steps as may be reasonably necessary to perfect the Company’s
sole and exclusive ownership of) any such application and any patents
resulting therefrom.






	(b)	 	If any provision of Article VIII(a) is determined by a court of competent
jurisdiction not to be enforceable in the manner set forth herein, the
Company and Grantee agree that it is the intention of the parties that
such provision should be enforceable to the maximum extent possible under
applicable law and that such court shall reform such provision to make it
enforceable in accordance with the intent of the parties.
	 
	(c)	 	Grantee acknowledges that a material part of the inducement for the
Company to grant the Option is Grantee’s covenants set forth in Article
VIII(a) and that the covenants and obligations of Grantee with respect to
nondisclosure, nonsolicitation, cooperation and intellectual property
rights relate to special, unique and extraordinary matters and that a
violation of any of the terms of such covenants and obligations will cause
the Company irreparable injury for which adequate remedies are not
available at law. Therefore, Grantee agrees that, if Grantee shall breach
any of those covenants or obligations, Grantee shall not be entitled to
exercise the Option or be entitled to retain any income therefrom and the
Company shall be entitled to an injunction, restraining order or such
other equitable relief (without the requirement to post bond) restraining
Grantee from committing any violation of the covenants and obligations
contained in Article VIII. The remedies in the preceding sentence are
cumulative and are in addition to any other rights and remedies the
Company may have at law or in equity as a court or arbitrator shall
reasonably determine.
	 
	(d)	 	Employment Dispute Arbitration Program — Mandatory Binding Arbitration of
Employment Disputes.






	 	(i)	 	Except as otherwise specified in this Agreement, the Grantee and
the Company agree that all employment-related legal disputes between
them will be submitted to and resolved by




 









 






	 	 	 	binding arbitration, and neither the Grantee nor the Company will file
or participate as an individual party or member of a class in a lawsuit
in any court against the other with respect to such matters. This
shall apply to claims brought on or after the date the Grantee accepts
this Agreement, even if the facts and circumstances relating to the
claim occurred prior to that date.
	 
	 	 	 	For purposes of Article VIII (d) of this Agreement, “the Company”
includes Aetna Inc., its subsidiaries and related companies, their
predecessors, successors and assigns, and those acting as
representatives or agents of those entities. THE GRANTEE UNDERSTANDS
THAT, WITH RESPECT TO CLAIMS SUBJECT TO THE ARBITRATION REQUIREMENT,
ARBITRATION REPLACES THE RIGHT OF THE GRANTEE AND THE COMPANY TO SUE OR
PARTICIPATE IN A LAWSUIT. THE GRANTEE ALSO UNDERSTANDS THAT IN
ARBITRATION, A DISPUTE IS RESOLVED BY AN ARBITRATOR INSTEAD OF A JUDGE
OR JURY, AND THE DECISION OF THE ARBITRATOR IS FINAL AND BINDING.
	 
	 	(ii)	 	THE GRANTEE UNDERSTANDS THAT THE ARBITRATION PROVISIONS OF THIS
AGREEMENT AFFECT THE LEGAL RIGHTS OF THE GRANTEE AND THE COMPANY AND
ACKNOWLEDGES THAT THE GRANTEE HAS BEEN ADVISED TO, AND HAS BEEN GIVEN
THE OPPORTUNITY TO, OBTAIN LEGAL ADVICE BEFORE SIGNING THIS AGREEMENT.
	 
	 	(iii)	 	Article VIII (d) of this Agreement does not apply to workers’
compensation claims, unemployment compensation claims, and claims
under the Employee Retirement Income Security Act of 1974 (“ERISA”)
for employee benefits. A dispute as to whether Article VIII (d) of
this Agreement applies must be submitted to the binding arbitration
process set forth in this Agreement.
	 
	 	(iv)	 	The Grantee and/or the Company may seek emergency or temporary
injunctive relief from a court (including with respect to claims
arising out of Article VIII (a) in accordance with applicable law).
However, except as provided in Article VIII (c) of this Agreement,
after the court has issued a ruling concerning the emergency or
temporary injunctive relief, the Grantee and the Company shall be
required to submit the dispute to binding arbitration pursuant to this
Agreement.
	 
	 	(v)	 	Unless otherwise agreed, the arbitration will be administered by
the American Arbitration Association (the “AAA”) and will be conducted
pursuant to the AAA’s National Rules for Dispute Resolution (the
“Rules”), as modified in this Agreement, in effect at the time the
request for arbitration is filed. The AAA’s Rules are available on
the AAA’s website at www.adr.org. THE GRANTEE ACKNOWLEDGES THAT THE
COMPANY HAS ENCOURAGED THE GRANTEE TO READ THESE RULES PROMPTLY AND
CAREFULLY AND THAT THE GRANTEE HAS BEEN AFFORDED SUFFICIENT
OPPORTUNITY TO DO SO.
	 
	 	(vi)	 	If the Company initiates a request for arbitration, the Company
will pay all of the administrative fees and costs charged by the AAA,
including the arbitrator’s compensation and charges for hearing room
rentals, etc. If the Grantee initiates a request for arbitration or
submits a counterclaim to the Company’s request for arbitration, the
Grantee shall be required to contribute One Hundred Dollars ($100.00)
to those administrative fees and costs,




 









 






	 	 	 	payable to the AAA at the time the Grantee’s request for arbitration or
counterclaim is submitted. The Company may increase the contribution
amount in the future without amending this Agreement, but not to exceed
the maximum permitted under the AAA rules then in effect. In all cases,
the Grantee and the Company shall be responsible for payment of any
fees assessed by the arbitrator as a result of that party’s delay,
request for postponement, failure to comply with the arbitrator’s
rulings and for other similar reasons.
	 
	 	(vii)	 	The Grantee and the Company may choose to be represented by
legal counsel in the arbitration process and shall be responsible for
their own legal fees, expenses and costs. However, the arbitrator
shall have the same authority as a court to order the Grantee or the
Company to pay some or all of the other’s legal fees, expenses and
costs, in accordance with applicable law.
	 
	 	(viii)	 	Unless otherwise agreed, there shall be a single arbitrator,
selected by the Grantee and the Company from a list of qualified
neutrals furnished by the AAA. If the Grantee and the Company cannot
agree on an arbitrator, one will be selected by the AAA.
	 
	 	(ix)	 	Unless otherwise agreed, the arbitration hearing will take place
in the city where the Grantee works or last worked for the Company.
If the Grantee and the Company disagree as to the proper locale, the
AAA will decide.
	 
	 	(x)	 	The Grantee and the Company shall be entitled to conduct limited
pre-hearing discovery. Each may take the deposition of one person and
anyone designated by the other as an expert witness. The party taking
the deposition shall be responsible for all associated costs, such as
the cost of a court reporter and the cost of an original transcript.
Each party also has the right to submit one set of ten written
questions (including subparts) to the other party, which must be
answered under oath, and to request and obtain all documents on which
the other party relies in support of its answers to the written
questions. Additional discovery may be permitted by the arbitrator
upon a showing that it is necessary for that party to have a fair
opportunity to present a claim or defense.
	 
	 	(xi)	 	The arbitrator shall apply the same substantive law that would
apply if the matter were heard by a court and shall have the authority
to order the same remedies (but no others) as would be available in a
court proceeding. The time limits for requesting arbitration or
submitting a counterclaim are the same as they would be in a court
proceeding. The arbitrator shall have the authority to consider and
decide dispositive motions (motions seeking a decision on some or all
of the claims or counterclaims without an arbitration hearing).
	 
	 	(xii)	 	All proceedings, including the arbitration hearing and decision,
are private and confidential, unless otherwise required by law.
Arbitration decisions may not be published or publicized without the
consent of both the Grantee and the Company.
	 
	 	(xiii)	 	Unless otherwise agreed, the arbitrator’s decision will be in
writing with a brief summary of the arbitrator’s opinion.
	 
	 	(xiv)	 	The arbitrator’s decision is final and binding on the Grantee
and the Company. After the arbitrator’s decision is issued, the
Grantee or the Company may obtain an order of judgment from a court
and may obtain a court order enforcing the decision. The arbitrator’s
decision may be appealed to the courts only under the limited
circumstances provided by law.




 









 






	 	(xv)	 	If the Grantee previously signed an agreement, including but not
limited to an employment agreement, containing arbitration provisions,
those provisions are superseded by the arbitration provisions of this
Agreement.
	 
	 	(xvi)	 	If any provision of Article VIII (d) is found to be void or
otherwise unenforceable, in whole or in part, this shall not affect
the validity of the remainder of Article VIII (d) and the remainder of
the Agreement. All other provisions shall remain in full force and
effect.






	(e)	 	The Company may terminate the Option if Grantee has willfully engaged in
gross misconduct or other serious impropriety which the Company determines
is likely to be damaging or detrimental to the Company, any Subsidiary or
Affiliate.





For purposes of this Article VIII, the term “Employment” shall refer to active
employment with the Company, any Subsidiary or Affiliate, and shall not include
severance periods.