**Exhibit10.3**

 
| **Notice of Grant of Stock Options  and Non-Qualified Stock Option Agreement** |   | **META Group, Inc.** |
|--------------------------------------------------------------------------------|--------|----------------------|

 

 

Effective 7/31/2002, you have been granted a Non-Qualified Stock Optionto buy 340,000 shares of META Group, Inc. (the Company) stock at $2.5000 pershare.

 

The total option price of the shares granted is $850,000.00.

 

Shares in each period will become exercisable on the date shown.

 
| **Shares** |   | **Vest Type** |   | **Full Vest** |   | **Expiration** |   |
|------------|--------|---------------|--------|---------------|--------|----------------|--------|
| 85,000     |   | On Vest Date  |   | July 31, 2003 |   | July 31, 2012  |   |
| 85,000     |   | On Vest Date  |   | July 31, 2004 |   | July 31, 2012  |   |
| 85,000     |   | On Vest Date  |   | July 31, 2005 |   | July 31, 2012  |   |
| 85,000     |   | On Vest Date  |   | July 31, 2006 |   | July 31, 2012  |   |

 

By your signature and the Company’s signature below, you and theCompany agree that these options are granted under and governed by the termsand conditions of the Company’s Stock Plan as amended and the Option Agreement,all of which are attached and made a part of this document.

 
|   /s/  John A. Piontkowski |   | 7/31/02 |   |
|--------------------------------------|--------|---------|--------|
| META Group, Inc.                     | Date   |
|                                 |   |
|                                 |   |
|   /s/  Alfred J. Amoroso   |   | 8/1/02  |   |
| Name:  Alfred  J. Amoroso       | Date   |

 

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META Group, Inc., a Delaware Corporation (the“Company”), hereby grants as of July 31, 2002 to you (the “Optionee”), anoption to purchase shares (the “Option Shares”) of its Common Stock, $.01 parvalue (“Common Stock”), at the price of **$2.50**per share.  The quantity of Option Shares granted and vesting schedule isdefined on the cover page, hereof.  TheOption Shares are granted on the following terms and conditions:

 

**1.**                                      **GrantUnder Second Amended and Restated 1995 Stock Plan.**  This option is granted pursuant to and isgoverned by the Company’s Second Amended and Restated 1995 Stock Plan (the“Plan”) and, unless the context otherwise requires, terms used herein shallhave the same meaning as in the Plan. Determinations made in connection with this option pursuant to the Planshall be governed by the Plan as it exists on this date.

 

**2.**                                      **Grant asNon-Qualified Option; Other Options.**  This option shall be treated for federal income tax purposes as aNon-Qualified Option (rather than an incentive stock option). This option is inaddition to any other options heretofore or hereafter granted to the Optioneeby the Company or any Related Corporation (as defined in the Plan), but aduplicate original of this instrument shall not effect the grant of anotheroption.

 

**3.**                                      **Vestingof Option if Business Relationship Continues.**

 

(a)  Subject toSections 3(b) and 3(c), if the Optionee continues to serve the Company or anyRelated Corporation in the capacity of an employee, officer, director orconsultant (such service is described herein as maintaining or being involvedin a “Business Relationship with the Company”) through the dates listed underthe column entitled “Full Vest” on the cover page hereof, the Optionee mayexercise this option for the number of shares of Common Stock set opposite theapplicable date.

 

(b)  Inaddition to the foregoing, but subject to Section 4, if, on or prior to July31, 2003, the Optionee’s Business Relationship with the Company and all RelatedCorporations is terminated (x) without Cause (as defined below) or (y)by the Optionee for Good Reason (as defined below), and, in each case,the Optionee executes a separation agreement reasonably satisfactory to theCompany and the Optionee which shall include a nondisparagement clause and acomprehensive release of claims (the “Separation Agreement”) and the SeparationAgreement has become irrevocable, then, this option shall becomeexercisable for an additional number of Option Shares, if any, equal to 50% ofthe total number of Option Shares with respect to which this option is not yetexercisable at the time of termination of such Business Relationship with theCompany.

 

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(c)  Inaddition to the foregoing, but subject to Section 4, (i) if, after July 31,2003 but prior to the expiration of this option, the Optionee’s BusinessRelationship with the Company and all Related Corporations is terminated (x)without Cause or (y) by the Optionee for Good Reason, and, ineach case, the Optionee executes the Separation Agreement and the SeparationAgreement has become irrevocable, or (ii) immediately prior to a Changeof Control (as defined below) consummated after July 31, 2003 but prior to theexpiration of this option, then, only upon the first of (i) or (ii) tooccur, this option shall become exercisable for an additional number of OptionShares, if any, equal to 50% of the total number of Option Shares with respectto which this option is not yet exercisable at the time of termination of suchBusiness Relationship with the Company or immediately prior to such Change ofControl, as the case may be; provided, however, that in the eventthat the acceleration set forth in this Section 3(c) occurs due to a Change ofControl under subsection (ii) above and Optionee’s Business Relationshipwith the Company and all Related Corporations is terminated without Cause or bythe Optionee for Good Reason within the three months following the Change ofControl and the Optionee executes the Separation Agreement and theSeparation Agreement has become irrevocable, this option shall then becomeexercisable for an additional number of Option Shares, if any, equal to 25% ofthe total number of Option Shares with respect to which this option was not yetexercisable immediately prior to the Change of Control *(for avoidance of doubt, the effect ofthis proviso shall be to give Optionee 75% of his unvested options in suchinstance)*.

 

(d) Notwithstanding the foregoing, in accordance with and subject to theprovisions of the Plan, the Committee may, in its discretion, furtheraccelerate the date that any installment of this Option becomes exercisable.  The foregoing rights are cumulative and(subject to Sections 4 or 5 hereof if the Optionee ceases to maintain aBusiness Relationship or be involved with the Company and all RelatedCorporations) may be exercised up to and including the date that is ten yearsfrom the date this option is granted.

 

(e)  “Change ofControl” shall mean:  the consummationof (i) the sale of the Company by merger in which the shareholders of theCompany in their capacity as such no longer own a majority of the outstandingequity securities of the Company (or its successor); (ii) any sale of all orsubstantially all of the assets or capital stock of the Company (other than ina spin-off or similar transaction) or (iii) any other acquisition of thebusiness of the Company, as determined by the Board in its sole discretion.

 

**4.**                                      **Terminationof Business Relationship.**

 

**(a)**                                  **TerminationOther****than****for****Cause****:**  If the Optionee’s Business Relationship with the Company and allRelated Corporations is terminated, other than by reason of death, disabilityor dissolution as defined in Section 5 or termination for Cause

 

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as defined in Section 4(c), no further installments of this optionshall become exercisable, and this option shall terminate (and may no longer beexercised) after the passage of 90 days from the date the Business Relationshipceases, but in no event later than the scheduled expiration date.  In such a case, the Optionee’s only rightshereunder shall be those that are properly exercised before the termination ofthis option.

 

**(b)**                                  **Terminationfor Cause or Breach: **Notwithstandingthe provisions of Sections 3 or 4, if the Optionee’s Business Relationship withthe Company is terminated for Cause (as defined in Section 4(c)) orOptionee breaches his obligations under the Employment Agreement between theCompany and Optionee dated as of July 31, 2002 (the “Employment Agreement”),the Separation Agreement or the Noncompetition Agreement (as defined in theEmployment Agreement), this option shall terminate upon the Optionee’s receiptof written notice of such termination or breach and shall thereafter not beexercisable to any extent whatsoever.

 

**(c)**                                  **Definitionof Cause:** Any one or more of the following events or conditionsshall constitute “Cause”: (i) the substantial, continuing and knowing failureof Optionee to render services to the Company or any Related Corporation inaccordance with the terms or requirements of Optionee’s Business Relationshipwith the Company; (ii)  gross negligence,willful misconduct, or breach of fiduciary duty to the Company or any RelatedCorporation, or disloyalty or dishonesty (which disloyalty or dishonestyresults in direct or indirect material loss, damage or injury to the Company orany Related Corporation); (iii) the commission of an act of embezzlement orfraud; (iv) deliberate disregard of the rules or policies of the Company or anyRelated Corporation that results in direct or indirect material loss, damage orinjury to the Company or any Related Corporation; (v) the unauthorized disclosureof any trade secret or confidential information of the Company or any RelatedCorporation; (vi) the commission of an act which constitutes unfair competitionwith the Company or any Related Corporation or which induces any customer orsupplier to breach a contract with the Company or any Related Corporation; or(vii) material breach of the Employment Agreement or the NoncompetitionAgreement.  Notwithstanding theforegoing, Cause shall not occur pursuant to clauses (i), (iv) and (vii) (butas to (vii) only with respect to material breaches of the Employment Agreement)unless Optionee fails, within 30 days after receipt of written notice from theCompany specifying the event or condition giving rise to Cause, to cure suchevent or condition, if capable of cure.

 

**(d)**                                  **“GoodReason”** shall mean a termination by Optionee of the EmploymentAgreement and his Business Relationship with the Company after he gives writtennotice to the Company within thirty (30) days following the date on which helearns of the occurrence, without his prior written consent, of any of thefollowing events during the Term (as defined in the Employment Agreement),which notice specifies the nature of such event, and the Company fails to curesuch event within thirty (30) days

 

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following receipt of such notice from Optionee:  (a) the failure of the Company to continueOptionee in the position of Chief Executive Officer, except where such failureis for Cause or due to Optionee’s Disability or death; (b) a materialdiminution in the nature or scope of Optionee’s responsibilities, duties orauthority; provided, however, that the assignment to others of the duties orresponsibilities of Optionee while Optionee is out of work due to a Disability,leave of absence or vacation, shall not constitute such a diminution; (c) anyreduction in Optionee’s Base Salary (as defined in the Employment Agreement;(d) a breach by the Company of any of its material obligations to Optioneeunder the Employment Agreement; or (e) the relocation of the Company’sprincipal office to a location more than 50 miles from Stamford, Connecticut,unless such location is 50 miles or less from Optionee’s residence after theRelocation (as defined in the Employment Agreement).

 

**5.**                                      **Death;Disability; Dissolution.**

 

**(a)**                                  **Death:**  If the Optionee dies while involved in aBusiness Relationship with the Company, the Optionee’s estate, personalrepresentative or beneficiary to whom this option has been assigned pursuant toSection 9 hereof may exercise this option, to the extent this option isotherwise exercisable on the date of the Optionee’s death, at any time within180 days after the date of death, but not later than the scheduled expirationdate.

 

**(b)**                                  **Disability:**  If the Optionee’s Business Relationship withthe Company is terminated by reason of his disability (as defined in the Plan),this option may be exercised, to the extent otherwise exercisable on the datethe Business Relationship was terminated, at any time within 180 daysafter such termination, but not later than the scheduled expiration date.

 

**(c)**                                  **Effect ofTermination:**  At theexpiration of such 180-day period provided in paragraph (a) or (b) of thisSection 5 or the scheduled expiration date, whichever is the earlier, thisoption shall terminate (and shall no longer be exercisable) and the only rightshereunder shall be those as to which the option was properly exercised beforesuch termination.

 

**6.**                                      **PartialExercise.**  This optionmay be exercised in part at any time and from time to time within the abovelimits, except that this option may not be exercised for a fraction of a shareunless such exercise is with respect to the final installment of stock subjectto this option and cash in lieu of a fractional share must be paid, inaccordance with Paragraph 13(G) of the Plan, to permit the Optionee toexercise completely such final installment. Any fractional share with respect to which an installment of this optioncannot be exercised because of the limitation contained in the precedingsentence shall

 

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remain subject to this option and shall be available for later purchaseby the Optionee in accordance with the terms hereof.

 

**7.**                                      **Paymentof Price**.

 

**(a)**                                  **Form ofPayment:**  The optionprice shall be paid in the following manner:

 

(i)                                     incash or by check;

 

(ii)                                  subjectto paragraph 7(b) below, by delivery of shares of the Company’s CommonStock having a fair market value (as determined by the Committee) equal as ofthe date of exercise to the option price;

 

(iii)                               by delivery of anassignment satisfactory in form****and substance to the Company of asufficient amount of the proceeds from the sale of the Option Shares and aninstruction to the broker or selling agent to pay that amount to the Company;or

 

(iv)                              byany combination of the foregoing.

 

**(b)**                                  **Limitationson Payment by Delivery of Common Stock:**  If the Optionee delivers Common Stock heldby the Optionee (“Old Stock”) to the Company in full or partial payment of theoption price, and the Old Stock so delivered is subject to restrictions orlimitations imposed by agreement between the Optionee and the Company, anequivalent number of Option Shares shall be subject to all restrictions andlimitations applicable to the Old Stock to the extent that the Optionee paidfor the Option Shares by delivery of Old Stock, in addition to any restrictionsor limitations imposed by this Agreement. Notwithstanding the foregoing, the Optionee may not pay any part of theexercise price hereof by transferring Common Stock to the Company unless suchCommon Stock has been owned by the Optionee free of any substantial risk offorfeiture for at least six months.

 

**(c)**                                  **PermittedPayment by Recourse Note:** In addition, if this paragraph is initialed below by the person signingthis Agreement on behalf of the Company, the option price may be paid bydelivery of the Optionee’s three-year personal recourse promissory note bearinginterest payable not less than annually at the applicable Federal rate, asdefined in Section 1274(d) of the Code.

 
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**8.**                                      **Method ofExercising Option.** Subject to the terms and conditions of this Agreement, this option maybe exercised by written notice to the Company, at the principal executiveoffice of the Company, or to such transfer agent as the Company shalldesignate.  Such notice shall state theelection to exercise this option and the number of Option Shares for which it isbeing exercised and shall be signed by the person or persons so exercising thisoption.  Such notice shall beaccompanied by payment of the full purchase price of such shares, and theCompany shall deliver a certificate or certificates representing such shares assoon as practicable after the notice shall be received.  Such certificate or certificates shall beregistered in the name of the person or persons so exercising this option (or,if this option is exercised by the Optionee and if the Optionee shall sorequest in the notice exercising this option, shall be registered in the nameof the Optionee and another person jointly, with right of survivorship).  If any person or persons other than theOptionee exercises this option pursuant to Section 5 hereof, such noticeshall be accompanied by appropriate proof of the right of such person orpersons to exercise this option.

 

**9.**                                      **OptionNot Transferable.**  Thisoption is not transferable or assignable except by will or by the laws ofdescent and distribution or pursuant to a valid domestic relations order.  Except as set forth in the precedingsentence, during the Optionee’s lifetime, only the Optionee may exercise thisoption.

 

**10.**                               **NoObligation to Exercise Option.** The grant and acceptance of this option imposes no obligation on theOptionee to exercise it.

 

**11.**                               **NoObligation to Continue Business Relationship.**  Neither the Plan, this Agreement, nor thegrant of this option imposes any obligation on the Company or any RelatedCorporation to continue to maintain a Business Relationship with the Optionee.

 

**12.**                               **No Rightsas Stockholder until Exercise.** The Optionee has no rights as a stockholder with respect to the OptionShares until such time as the Optionee has exercised this option by deliveringa notice of exercise and has paid in full the purchase price for the number ofshares for which this option is to be so exercised in accordance with Section8.  Except as is expressly provided inthe Plan with respect to certain changes in the capitalization of the Company,no adjustment shall be made for dividends or similar rights for which therecord date is prior to such date of exercise.

 

**13.**                               **CapitalChanges and Business Successions.**  The Plan contains provisions covering the treatment of options ina number of contingencies such as stock splits and mergers.  Provisions in the Plan for adjustment withrespect to stock subject to

 

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options and the related provisions with respect to successors to thebusiness of the Company are hereby made applicable hereunder and areincorporated herein by reference.

 

**14.**                               **WithholdingTaxes.**  If the Company orany Related Corporation in its discretion determines that it is obligated towithhold any tax in connection with the exercise of this option, or inconnection with the transfer of, or the lapse of restrictions on, any CommonStock or other property acquired pursuant to this option, the Optionee herebyagrees that the Company or any Related Corporation may withhold from theOptionee’s wages or other remuneration the appropriate amount of tax; provided,however, that prior to any such withholding the Optionee shall be givenan opportunity to make alternative arrangements for the provision of such taxamounts to the Company.  At thediscretion of the Company or Related Corporation, the amount required to bewithheld may be withheld in cash from such wages or other remuneration or inkind from the Common Stock or other property otherwise deliverable to theOptionee on exercise of this option. The Optionee further agrees that, if the Company or Related Corporationdoes not withhold an amount from the Optionee’s wages or other remunerationsufficient to satisfy the withholding obligation of the Company or RelatedCorporation, the Optionee shall make reimbursement on demand, in cash, for theamount underwithheld.

 

**15.**                               **Lock-upAgreement.** The Optioneeagrees that in connection with an underwritten public offering of Common Stock,upon the request of the Company or the principal underwriter managing suchpublic offering, this Option and the Option Shares may not be sold, offered forsale or otherwise disposed of without the prior written consent of the Companyor such underwriter, as the case may be, for at least 270 days after theeffectiveness of the Registration Statement filed in connection with suchoffering, or such longer period of time as the Board of Directors may determineif all of the Company’s directors and officers agree to be similarlybound.  The lock-up agreementestablished pursuant to this paragraph 15 shall have perpetual duration.

 

**16.**                               **Arbitration.** Any dispute, controversy, or claimarising out of, in connection with, or relating to the performance of thisAgreement or its termination shall be settled by arbitration in the State ofConnecticut, pursuant to the rules then pertaining of the American ArbitrationAssociation.  Any award shall be final,binding and conclusive upon the parties and a judgment rendered thereon may beentered in any court having jurisdiction thereof.

 

**17.**                               **Provisionof Documentation to Optionee**. By signing this Agreement the Optionee acknowledges receipt of a copy ofthis Agreement and a copy of the Plan.

 

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**18.**                               **Miscellaneous.**

 

**(a)** **Notices:**  All notices hereunder shall be in writingand shall be deemed given when sent by certified or registered mail, postageprepaid, return receipt requested, to the address set forth below.  The addresses for such notices may bechanged from time to time by written notice given in the manner provided forherein.

 

**(b)** **EntireAgreement; Modification:** This Agreement constitutes the entire agreement between the partiesrelative to the subject matter hereof, and supersedes all proposals, written ororal, and all other communications between the parties relating to the subjectmatter of this Agreement.  ThisAgreement may be modified, amended or rescinded only by a written agreementexecuted by both parties.

 

**(c)** **Severability:**  The invalidity, illegality orunenforceability of any provision of this Agreement shall in no way affect thevalidity, legality or enforceability of any other provision.

 

**(d)** **Successorsand Assigns:** This Agreement shall be binding upon and inure tothe benefit of the parties hereto and their respective successors and assigns,subject to the limitations set forth in Section 9 hereof.

 

**(e)  Governing Law:**  This Agreement shall be governed by andinterpreted in accordance with the laws of the State of Delaware, withoutgiving effect to the principles of the conflicts of laws thereof.  The preceding choice of law provision shallapply to all claims, under any theory whatsoever, arising out of therelationship of the parties contemplated herein.

 

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