Document:

Unassociated Document

    
      Exhibit
        10.1

       

      CLARUS
        CORPORATION

      2005
        STOCK INCENTIVE PLAN

      STOCK
        OPTION AGREEMENT

       

      STOCK
        OPTION AGREEMENT (the “Agreement”) made as of this «numberdate»
        day of
«month»,
        «year»,
        by and
        between Clarus Corporation, a Delaware corporation, having its principal
        office
        at One Landmark Square, 22nd Floor, Stamford, Connecticut 06901 (the “Company”),
        and «FirstName» «LastName»,
        an
        individual residing in «citystate»
        (the
“Optionee”). Capitalized terms not defined herein shall have the meanings
        ascribed to them in the Company’s 2005 Stock Incentive Plan.

      

      WHEREAS,
        the
        Company has heretofore adopted the Clarus Corporation 2005 Stock Incentive
        Plan
        (the “Plan”) for the benefit of certain employees, officers, directors,
        consultants, independent contractors and advisors of the Company or Subsidiaries
        of the Company, which Plan has been approved by the Company’s stockholders;
        and

      

      WHEREAS,
        the
        Optionee is a valued and trusted [employee] [director] [consultant] of the
        Company and/or one of its subsidiaries and the Company believes it to be
        in the
        best interests of the Company to secure the future services of the Optionee
        by
        providing the Optionee with an inducement to remain an [employee/director
        of]
        [consultant to] the Company and/or one of its Subsidiaries through the grant
        of
        an option to acquire an ownership interest in the Company.

      

      NOW,
        THEREFORE, the
        parties agree as follows:

      

      1. Option
        Grant.
        Subject
        to the provisions hereinafter set forth and the terms and conditions of the
        Plan, the Company hereby grants to the Optionee, as of «grantdate»
        (the
“Grant Date”), the right, privilege and option (the “Option”) to purchase all or
        any part of an aggregate of «amountofoptions»
        shares
        (the “Shares”) of common stock of the Company, par value $0.0001 per share (the
“Common Stock”), such number being subject to adjustment as provided in the
        Plan. To the extent applicable, this Option is intended to qualify as an
        “incentive stock option” (“ISO”) within the meaning of Section 422 of the
        Internal Revenue Code of 1986, as amended (the “Code”), to the extent permitted
        under Section 422 of the Code.

      

      2.
         Exercise
        Price.
        Subject
        to adjustment as provided in the Plan, the purchase price per Share of Common
        Stock as to which this Option is exercised (the “Exercise Price”) shall be
$«shareprice»,
        the
        Fair Market Value of such Shares on the Grant Date. 

      

      3. Exercise
        of Option.
        The term
        of the Option shall be for a period of ten (10) years from the Grant Date
        and
        shall expire without further action being taken at 5:00 p.m., «expirationdate»,
        subject
        to earlier termination as provided in Section 5 hereof (the “Expiration Date”).
        The Option may be exercised at any time, or from time to time, prior to the
        Expiration Date (or such additional period as may be permitted under the
        Plan)
        as to any part or all of the Shares covered by the Option, pursuant to the
        vesting schedule contained in Section 4.1 hereof; provided, however, that
        the
        Option may not be exercised as to less than one hundred (100) shares, unless
        it
        is exercised as to all Shares as to which this Option is then exercisable.
        

       

      
         

        One
          Landmark Square, 22nd Floor, Stamford, Connecticut 06901 Tel: (203) 428-2000
          Fax: 203-428-2024

         

        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      4. Vesting
        and Lockup Release Schedule. 

      

      4.1Vesting
        Date.
        The
        Shares into which this Option is exercisable shall vest in accordance with
        the
        following schedule:

      

      
        	
                 

                Vesting
                  Date

              	 	
                Number
                  of 

                ISOs

              	 	
                Number
                  of 

                Non-Qualified

              	
                 

              	
                Total
                  Number 

                of
                  Shares

              
	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              	
                 

              
	
                <<Insert
                  Date>>

              	
                 

              	
                «Total_ISOs» 

              	
                 

              	
                «Total_NQSOs» 

              	
                 

              	
                «amountofoptions» 

              

      

       

      The
        allocation of options granted between ISOs and NQSOs indicated above is a
        result
        of the Limitations on ISO as outlined in the 2005 Stock Incentive Plan and
        reproduced below.

      

      5.7 Limitations
        on ISO.
        The aggregate Fair Market Value (determined as of the date of grant) of Shares
        with respect to which ISO’s are exercisable for the first time by a Participant
        during any calendar year (under this Plan or under any other incentive stock
        option plan of the Company or any Subsidiary of the Company) will not exceed
        $100,000 or such other amount as may be required by the Code. If the Fair
        Market
        Value of Shares on the date of grant with respect to which ISO’s are exercisable
        for the first time by a Participant during any calendar year exceeds $100,000,
        then the Options for the first $100,000 worth of Shares to become exercisable
        in
        such calendar year will be ISO’s and the Options for the amount in excess of
        $100,000 that become exercisable in that calendar year will be NQSO’s. In the
        event that the Code or the regulations promulgated thereunder are amended
        after
        the Effective Date of this Plan to provide for a different limit on the Fair
        Market Value of Shares permitted to be sub-ject to ISO’s, such different limit
        will be automatically incorporated herein and will apply to any Options granted
        after the effective date of such amendment.

      

      4.2 Shares
        that are vested pursuant to the schedule set forth in Section 4.1 hereof
        are
“Vested Shares.”

      

      5. Termination.

      

      5.1 Termination
        for Any Reason Except Death, Disability or Cause.
        If
        Optionee is Terminated by the Company for any reason (including if the Optionee
        voluntarily terminates [employment by] [service for] the Company) except
        Optionee’s death, Disability or Cause, then this Option, to the extent (and only
        to the extent) that it is vested in accordance with the schedule set forth
        in
        Section 4.1 hereof on the Termination Date, may be exercised by Optionee
        no
        later than three (3) months after the Termination Date, (or such longer time
        period not exceeding five (5) years as may be determined by the Committee,
        with
        any exercise beyond three (3) months after the Termination Date deemed to
        be a
        NQSO), but in any event no later than the Expiration Date.

      

      5.2 Termination
        Because of Death or Disability.
        If
        Optionee is Terminated because of death or Disability of Optionee, then this
        Option, to the extent that it is vested in accordance with the schedule set
        forth in Section 4.1 hereof on the Termination Date, may be exercised by
        Optionee (or Optionee’s legal representative or authorized assignee) no later
        than twelve (12) months after the Termination Date (or such longer time period
        not exceeding five (5) years as may be determined by the Committee, with
        any
        such exercise beyond twelve (12) months after the Termination Date when the
        Termination is for Participant’s death or Disability, deemed to be a NQSO), but
        in any event no later than the Expiration Date. Any exercise after three
        months
        after the Termination Date when the Termination is for any reason other than
        Optionee’s disability, within the meaning of Section 22(e)(3) of the Code, shall
        be deemed to be the exercise of a nonqualified stock option.

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      5.3 Termination
        for Cause.
        If an
        Optionee is terminated for Cause, neither the Optionee, the Optionee’s estate
        nor such other person who may then hold the Option shall be entitled to exercise
        any Option with respect to any Shares whatsoever, after termination of service,
        whether or not after termination of service the Optionee may receive payment
        from the Company or Subsidiary for vacation pay, for services rendered prior
        to
        termination, for services rendered for the day on which termination occurs,
        for
        salary in lieu of notice, or for any other benefits. In making such
        determination, the Committee shall give the Optionee an opportunity to present
        to the Committee evidence on his behalf. For the purpose of this paragraph,
        termination of service shall be deemed to occur on the date when the Company
        dispatches notice or advice to the Optionee that Optionee’s service is
        terminated. 

      

      For
        purposes of this Agreement, Termination for Cause means that the Company
        has
        cause to terminate an Optionee’s employment or service under any existing
        employment, consulting or any other agreement between the Optionee and the
        Company or, if such an agreement does not exist, upon finding that (i) the
        Optionee has ceased to perform his duties (other than as a result of his
        incapacity due to physical or mental illness or injury), which constitutes
        an
        intentional or extended neglect of his/her duties, (ii) the Optionee has
        engaged
        or is about to engage in conduct materially injurious to the Company or (iii)
        the Optionee has been convicted of a felony.

      

      5.4 No
        Obligation to Employ.
        Nothing
        in the Plan or this Agreement shall confer on Optionee any right to continue
        in
        the employ of, or other relationship with, the Company, a Subsidiary or an
        Affiliate, or limit in any way the right of the Company or any Affiliate
        or
        Subsidiary of the Company to terminate Optionee’s employment or other
        relationship at any time, with or without Cause. This Agreement does not
        constitute an employment or other service contract. This Agreement does not
        guarantee employment or other service for the length of time of the Vesting
        Schedule or for any portion thereof.

       

      6. Manner
        of Exercise.

      

      6.1 Stock
        Option Exercise Procedures.
        To
        exercise this Option, Optionee (or in the case of exercise after Optionee’s
        death, Optionee’s executor, administrator, heir or legatee, as the case may be)
        must follow such exercise procedures as may be established by the Committee
        from
        time to time in its sole discretion. Such procedures may include requiring
        that
        the Optionee provide certain information including, inter alia, Optionee’s
        election to exercise this Option, the number of Shares being purchased, any
        restrictions imposed on the Shares and any representations, warranties and
        agreements regarding Optionee’s investment intent and access to information as
        may be required by the Company to comply with applicable securities laws.
        If
        someone other than Optionee exercises this Option, then such person may be
        required to submit documentation reasonably acceptable to the Company that
        such
        person has the right to exercise this Option.

      

      6.2 Limitations
        on Exercise.
        This
        Option may not be exercised unless such exercise is in compliance with all
        applicable federal and state securities laws, as they are in effect on the
        date
        of exercise. 

      

      6.3 Payment.
        An
        exercise of this Option shall be accompanied by full payment of the aggregate
        Exercise Price for the Shares being purchased (a) in cash (by check), or
        (b)
        provided that a public market for the Company’s stock exists: (1) through a
“same day sale” commitment from Optionee and a broker-dealer that is a member of
        the National Association of Securities Dealers (an “NASD Dealer”) whereby
        Optionee irrevocably elects to 

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      exercise
        this Option and to sell a portion of the Shares so purchased to pay for the
        aggregate Exercise Price and whereby the NASD Dealer irrevocably commits
        upon
        receipt of such Shares to forward the aggregate Exercise Price directly to
        the
        Company; or (2) through a “margin” commitment from Optionee and an NASD Dealer
        whereby Optionee irrevocably elects to exercise this Option and to pledge
        the
        Shares so purchased to the NASD Dealer in a margin account as security for
        a
        loan from the NASD Dealer in the amount of the aggregate Exercise Price,
        and
        whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
        forward the aggregate Exercise Price directly to the Company. Notwithstanding
        the foregoing, the Board of Directors or the Committee, in their sole
        discretion, may allow for the full payment of the aggregate Exercise Price
        for
        the Shares being purchased to be made by any other method which is in accordance
        with the provisions of the Plan.

      

      6.4 Tax
        Withholding.
        Prior
        to the issuance of the Shares upon exercise of this Option, Optionee must
        pay or
        provide for any applicable federal or state withholding obligations of the
        Company. If the Committee permits, Optionee may provide for payment of
        withholding taxes upon exercise of this Option by requesting that the Company
        retain Shares with a Fair Market Value equal to the minimum amount of taxes
        required to be withheld determined on the date that the amount of tax to
        be
        withheld is to be determined. In such case, the Company shall issue the net
        number of Shares to the Optionee by deducting the Shares retained from the
        Shares issuable upon exercise.

      

      6.5 Issuance
        of Shares.
        Provided that both the exercise procedures established by the Committee and
        payment are in manner, form and substance satisfactory to the Company, and
        upon
        the Company’s request to counsel for the Company, the Company shall issue the
        Shares registered in the name of Optionee, Optionee’s authorized assignee, or
        Optionee’s legal representative, and shall deliver certificates representing the
        Shares with the appropriate legends affixed thereto.

      

      7. Notice
        of Disqualifying Disposition of ISO Shares.
        To the
        extent this Option is an ISO, if Optionee sells or otherwise disposes of
        any of
        the Shares acquired pursuant to the ISO on or before the later of (a) the
        date
        two (2) years after the Date of Grant, and (b) the date one (1) year after
        transfer of such Shares to Optionee upon exercise of this Option, then Optionee
        shall immediately notify the Company in writing of such
        disposition.

       

      8. Compliance
        With Laws and Regulations.
        The
        exercise of this Option and the issuance and transfer of Shares to the Optionee
        shall be subject to compliance by the Company and Optionee with (i) all
        applicable requirements of federal and state securities laws, (ii) all
        applicable requirements of any stock exchange on which the Company’s Common
        Stock may be listed and (iii) any applicable policy of the Company regarding
        the
        trading of securities of the Company, each at the time of such issuance and
        transfer. Optionee understands that the Company is under no obligation to
        register or qualify the Shares with the SEC, any state securities commission
        or
        any stock exchange to effect such compliance.

      

      9. Nontransferability
        of Option.
        This
        Option may not be transferred in any manner other than transfers by will
        or by
        the laws of descent and distribution or to members of the Optionee’s immediate
        family, to trusts solely for the benefit of such immediate family members
        and to
        partnerships or limited liability companies in which such family members
        and/or
        trusts are the only partners or members, as the case may be. For this purpose,
        “immediate family” means the Optionee’s spouse, parents, children, stepchildren,
        grandchildren and legal dependants. Any transfer of Options made under this
        provision will not be effective until notice of such transfer is delivered
        to
        the Company. The terms of this Option shall be binding upon the executors,
        administrators, successors and assigns of Optionee.

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      10. Privileges
        of Stock Ownership.
        Optionee
        shall not have any of the rights of a stockholder with respect to any Shares
        until the Shares are issued to Optionee.

      

      11. Interpretation.
        Any
        dispute regarding the interpretation of this Agreement shall be submitted
        by
        Optionee or the Company to the Committee for review. The resolution of such
        a
        dispute by the Committee shall be final and binding on the Company and
        Optionee.

      

      12. Entire
        Agreement.
        The Plan
        is incorporated herein by reference. This Agreement and the Plan and any
        exercise procedures as may be established by the Committee constitute the
        entire
        agreement and understanding of the parties hereto with respect to the subject
        matter hereof and supersede all prior understandings and agreements with
        respect
        to such subject matter.

      

      13. Notices.
        Any
        notice required to be given or delivered to the Company under the terms of
        this
        Agreement shall be in writing and addressed to the Corporate Secretary of
        the
        Company at its principal corporate offices. Any notice required to be given
        or
        delivered to Optionee shall be in writing and addressed to Optionee at the
        address indicated above or to such other address as such party may designate
        in
        writing from time to time to the Company. All notices shall be deemed to
        have
        been given or delivered upon: personal delivery; three (3) days after deposit
        in
        the United States mail by certified or registered mail (return receipt
        requested); one (1) business day after deposit with any return receipt express
        courier (prepaid); or one (1) business day after transmission by
        facsimile.

      

      14. Successors
        and Assigns.
        The
        Company may assign any of its rights under this Agreement. This Agreement
        shall
        be binding upon and inure to the benefit of the successors and assigns of
        the
        Company. Subject to the restrictions on transfer set forth herein, this
        Agreement shall be binding upon Optionee and Optionee’s heirs, executors,
        administrators, legal representatives, successors and assigns.

      

      15. Governing
        Law.
        This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of Delaware, applicable to agreements made and to be performed entirely
        within such state, other than conflict of laws principles thereof directing
        the
        application of any law other than that of Delaware.

      

      16. Acceptance.
        Optionee
        hereby acknowledges receipt of a copy of the Plan and this Agreement. Optionee
        has read and understands the terms and provisions of the Plan, and accepts
        this
        Option subject to all the terms and conditions of the Plan and this Agreement.
        This Option is subject to, and the Company and the Optionee agree to be bound
        by, all of the terms and conditions of the Plan under which this Option was
        granted, as the same shall have been amended, restated or otherwise modified
        from time to time in accordance with the terms thereof. Pursuant to said
        Plan,
        the Board of Directors of the Company, or the Committee is vested with final
        authority to interpret and construe the Plan and this Option, and its present
        form is available for inspection during the business hours by the Optionee
        or
        other persons entitled to exercise this Option at the Company’s principal
        office. Optionee acknowledges that there may be adverse tax consequences
        upon
        exercise of this Option or disposition of the Shares and that the Company
        has
        advised Optionee to consult a tax advisor prior to such exercise or
        disposition.

      

      17. Covenants
        of the Optionee

      

      The
        Optionee agrees (and for any heir, executor, administrator, legal
        representative, successor, or assignee hereby agrees), as a condition upon
        exercise of the Option granted hereunder:

      

      (a) Upon
        the
        request of the Committee, to execute and deliver a certificate, in form
        satisfactory to the Committee, certifying that the Shares being acquired
        upon
        exercise of the Option are for such person’s own account for investment only and
        not with any view to or present intention to resell or distribute the same.
        The
        Optionee hereby agrees that the Company shall have no obligation to deliver
        the
        Shares issuable upon exercise of the Option unless and until such certificate
        shall be executed and delivered to the Company by the Optionee or any
        successor.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      (b) Upon
        the
        request of the Committee, to execute and deliver a certificate, in form
        satisfactory to the Committee, certifying that any subsequent resale or
        distribution of the Shares by the Optionee shall be made only pursuant to
        either
        (i) a Registration Statement on an appropriate form under the Securities
        Act of
        1933, as amended (the “Securities Act”), which Registration Statement has become
        effective and is current with regard to the Shares being sold, or (ii) a
        specific exemption from the registration requirements of the Securities Act,
        but
        in claiming such exemption the Optionee shall, prior to any offer of sale
        or
        sale of such Shares, obtain a prior favorable written opinion of counsel,
        in
        form and substance satisfactory to counsel for the Company, as to the
        application of such exemption thereto. The foregoing restriction contained
        in
        this subparagraph (b) shall not apply to (i) issuances by the Company so
        long as
        the Shares being issued are registered under the Securities Act and a prospectus
        in respect thereof is current, or (ii) re-offerings of Shares by Affiliates
        of
        the Company (as defined in Rule 405 or any successor rule or regulation
        promulgated under the Securities Act) if the Shares being re-offered are
        registered under the Securities Act and a prospectus in respect thereof is
        current.

      

      (c) That
        certificates evidencing Shares purchased upon exercise of the Option shall
        bear
        a legend, in form satisfactory to counsel for the Company, manifesting the
        investment intent and resale restrictions of the Optionee described in this
        Section.

      

      (d) That
        upon
        exercise of the Option granted hereby, or upon sale of the Shares purchased
        upon
        exercise of the Option, as the case may be, the Company shall have the right
        to
        require the Optionee to remit to the Company, or in lieu thereof, the Company
        may deduct, an amount of shares or cash sufficient to satisfy federal, state
        or
        local withholding tax requirements, if any, prior to the delivery of any
        certificate for such Shares or thereafter, as appropriate.

      

      18. Obligations
        of the Company

      

      18.1 Upon
        the
        exercise of this Option in whole or in part, the Company shall cause the
        purchased Shares to be issued only when it shall have received the full payment
        of the aggregate Exercise Price in accordance with the terms of this
        Agreement.

      

      18.2 The
        Company shall cause certificates for the Shares as to which the Option shall
        have been exercised to be registered in the name of the person or persons
        exercising the Option, which certificates shall be delivered by the Company
        to
        the Optionee only against payment of the full Exercise Price in accordance
        with
        the terms of this Agreement for the portion of the Option exercised.

      

      18.3
         In
        the
        event that the Optionee shall exercise this Option with respect to less than
        all
        of the Shares of Common Stock that may be purchased under the terms hereof,
        the
        Company shall issue to the Optionee a new Option, duly executed by the Company
        and the Optionee, in form and substance identical to this Option, for the
        balance of Shares of Common Stock then issuable pursuant to the terms of
        this
        Option.

      

      18.4 Notwithstanding
        anything to the contrary contained herein, neither the Company nor its transfer
        agent shall be required to issue any fraction of a Share of Common Stock
        in
        connection with the exercise of this Option, and the Company shall, upon
        exercise of this Option in whole or in part, issue the largest number of
        whole
        Shares of Common Stock to which this Option is entitled upon such full or
        partial exercise and shall return to the Optionee the amount of the aggregate
        Exercise Price paid by the Optionee in respect of any fractional
        Share.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      18.5 The
        Company may endorse such legend or legends upon the certificates for Shares
        issued to the Optionee pursuant to the Plan and may issue such “stop transfer”
        instructions to its transfer agent in respect of such Shares as, in its
        discretion, it determines to be necessary or appropriate
        to: (i) prevent a violation of, or to perfect an exemption from, the
        registration requirements of the Securities Act; (ii) implement the provisions
        of the Plan and any agreement between the Company and the Optionee with respect
        to such Shares; or (iii) permit the Company to determine the occurrence of
        a
        disqualifying disposition, as described in Section 421(b) of the Code, of
        Shares
        transferred upon exercise of an incentive stock option granted pursuant to
        this
        Agreement and under the Plan.

      

      18.6 The
        Company shall pay all issue or transfer taxes with respect to the issuance
        or
        transfer of Shares to the Optionee, as well as all fees and expenses necessarily
        incurred by the Company in connection with such issuance or transfer, except
        fees and expenses which may be necessitated by the filing or amending of
        a
        Registration Statement under the Securities Act, which fees and expenses
        shall
        be borne by the Optionee, unless such Registration Statement under the
        Securities Act has been filed by the Company for its own corporate purposes
        (and
        the Company so states) in which event the Optionee shall bear only such fees
        and
        expenses as are attributable solely to the inclusion of the Shares he or
        she
        receives in the Registration Statement.

      

      18.7 All
        Shares issued following exercise of the Option and the payment of the Exercise
        Price in accordance with the terms of this Agreement therefore shall be fully
        paid and non-assessable to the extent permitted by law.

      

      19. Miscellaneous

      

      19.1 If
        the
        Optionee loses this Agreement representing the Option granted hereunder,
        or if
        this Agreement is stolen or destroyed, the Company shall, subject to such
        reasonable terms as to indemnity as the Committee, in its sole discretion
        shall
        require, enter into a new option agreement pursuant to which the Company
        shall
        issue a new Option, in form and substance identical to this Option, and in
        substitution for, the Option so lost, stolen or destroyed, and in the event
        this
        Agreement representing the Option shall be mutilated, the Company shall,
        upon
        the surrender hereof, enter into a new option agreement pursuant to which
        the
        Company shall issue a new Option, in form and substance identical to this
        Option, and in substitution for, the Option so mutilated.

      

         19.2 This
        Agreement cannot be amended, supplemented or changed, and no provision hereof
        can be waived, except by a written instrument making specific reference to
        this
        Agreement and signed by the party against whom enforcement of any such
        amendment, supplement, modification or waiver is sought. A waiver of any
        right
        derived hereunder by the Optionee shall not be deemed a waiver of any other
        right derived hereunder.

       

      19.3 This
        Agreement may be executed in any number of counterparts, but all counterparts
        will together constitute but one agreement.

      

      19.4 In
        the
        event of a conflict between the terms and conditions of this Agreement and
        the
        Plan, the terms and conditions of the Plan shall govern. 

      

      19.5 Any
        dispute regarding the interpretation of this Agreement shall be submitted
        by
        Optionee or the Company to the Committee for review. The resolution of such
        a
        dispute by the Committee shall be final and binding on the Company and
        Optionee.

      
         

        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      IN
        WITNESS WHEREOF,
        the
        Company has caused this Agreement to be executed in duplicate by its duly
        authorized representative and Optionee has executed this Agreement in duplicate
        as of the Date of Grant.

       

      
        	
                 

              	 	 
	 	CLARUS
                CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
                
Name:
	 	Title: 
	 	 
	 	 
	 	OPTIONEE:
	 	 
	 	 
	 	
                
«FirstName» «LastName»

      

       

       

      
        
          
          

        

        
          8<PAGE>

                       HARMONY (2003) SHARE OPTION SCHEME

1     DEFINITIONS

      In this Option Scheme the following words and expressions have the meaning
      assigned thereto and words signifying the singular shall include the
      plural and vice versa:

1.1     "AUDITORS" means the auditors for the time being of the Company;

1.2     "COMPANY" means HARMONY GOLD MINING COMPANY LIMITED (Registration Number
        1950/038232/06);

1.3     "DIRECTORS" means the board of directors of the Company or any committee
        thereof to whom the powers of the directors in respect of the Option
        Scheme are delegated in terms of the Company's articles of association;

1.4     "EMPLOYEE" means any employee of the Company or its subsidiaries from
        time to time and any person who is employed by a company or close
        corporation with whom the Company has entered into an agreement in terms
        of which the services of such person are provided exclusively to the
        Company or any of its subsidiaries for the time being;

1.5     "EXISTING SCHEMES" means:

1.5.1     Harmony (1994) Share Option Scheme;

1.5.2     Harmony (2001) Share Option Scheme;

1.6     "JSE" means the JSE Securities Exchange South Africa;

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                                     Page 2

1.7     "OPTION" means an option to purchase or subscribe for shares in the
        Company granted in terms of the Option Scheme;

1.8     "PARTICIPANT" means an employee or retired employee;

1.9     "RETIRED EMPLOYEE" means any employee who has retired in terms of the
        rules of any pension and/or provident fund in existence for the benefit
        of any employee and of which the employee is a member of any such fund
        who has reached the prescribed retirement age as determined by a service
        contract between the Company and the employee concerned;

1.10    "OPTION SCHEME" means HARMONY (2003) SHARE OPTION SCHEME;

1.11    "SHARE" means an ordinary share of R0,50 in the capital of the Company.

2     OBJECT

      The object and purpose of the Option Scheme is to grant options to
      employees to enable them to acquire fully paid shares in the Company in
      the manner and on the terms and conditions set out in the Option Scheme.

3     SHARES AVAILABLE FOR THE OPTION SCHEME

3.1     The aggregate number of fully paid shares which any one participant may
        acquire in terms of the Option Scheme (read with the Existing Schemes)
        will not exceed 1 290 831 shares, which represents 0.5% (one comma five
        percent) of the issued share capital of the Company as at 16 September
        2003.

3.2     The aggregate number of unissued shares that may be used for the Option
        Scheme (read with the Existing Schemes) shall not exceed 36 096 604
        shares, which represents 14% (ten percent) of the issued

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                                     Page 3

        share capital of the Company as at 16 September 2003. Shares which are
        the subject of lapsed or terminated options and shares which are the
        subject of options which have been exercised by participants who are no
        longer employees shall not be regarded as being reserved for the Option
        Scheme.

3.3     Subject always to the provisions of section 223 of the Companies Act,
        1973 (Act 61 of 1973), as amended, the members of the Company may from
        time to time in general meeting, reserve unissued shares and place those
        unissued shares under the control of the directors for the purpose of
        the Option Scheme.

4     OPTIONS

4.1     The directors may grant options to employees selected by the directors
        or the trustees, as the case may be, for that purpose.

4.2     The directors may specify when granting an option and/or impose such
        objective conditions by way of performance targets, in respect of both
        the individual and the Company, which they consider fair and reasonable
        to be satisfied before that option may be exercised, and in this respect
        the directors may at their discretion subsequently amend or waive such
        objective conditions if events occur which cause the directors
        reasonably to consider that it would be more just so to amend or waive
        the conditions. Such conditions shall be notified to the participant on
        date of grant of the option.

4.3     The directors shall determine the number of shares which are to be the
        subject of each option.

4.4     The price at which an option may be exercised will be in respect of each
        share which is the subject of the option, the closing market price of a
        share on the JSE, as certified by the secretary of the

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                                     Page 4

        Company, on the trading day preceding that on which the employee is
        granted the option.

4.5     Subject to clause 4.10 each option granted will remain in force for a
        period of 10 years after the date of granting the option.

4.6     Each option may only be exercised in multiples of 100 shares.

4.7     Each option may only be exercised by a participant at such time or times
        over a period commencing not less than one year from date on which the
        option was granted as the directors may have determined and notified in
        writing to the participant when the option was granted to the
        participant, provided that notwithstanding, the aforegoing:

4.7.1     upon the death of a participant, all of the options held by such
          participant, whether or not such options could then have been
          exercised by the participant in terms of the above provisions of this
          clause 4.7 may, subject to clause 4.10.1, to be exercised by the
          executor(s) of his estate;

4.7.2     upon the retirement of a participant, all of the options held by such
          participant which could then have been exercised by the participant in
          terms of the above provisions of this clause 4.7 and such of the
          remaining options, held by such participant which the directors, in
          their sole discretion, may permit to be exercised by the participant
          notwithstanding that they could not then have been exercised by the
          participant in terms of the above provisions of this clause 4.7 may,
          subject to clause 4.10.2 and 4.14, be exercised by the participant;
          and

4.7.3     the directors shall be entitled, in their absolute discretion and from
          time to time, to permit an option to be exercised in respect of all or
          part of the shares which are the subject of that option.

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                                     Page 5

        For the purpose of this sub-clause 4.7, a reference to "SHARES WHICH ARE
        THE SUBJECT OF THAT OPTION" refers to the number of shares at the date
        when the option was granted.

        Notwithstanding anything contained in this scheme, unless the directors
        otherwise determine by notice in writing, an option may be exercised by
        an employee or retired employee in the event that a person and/or his
        concert party or parties (as defined in the Rules of the Securities
        Regulation Panel) acquired such number of shares in the Company as
        results in the person and/or his concert party or parties having to make
        an offer to all other shareholders of the Company in terms of the Rules
        of the Securities Regulation Panel.

4.8     Notwithstanding anything contained in the Option Scheme, unless the
        directors otherwise agree in writing, a participant:

4.8.1     shall not be entitled to dispose of any shares acquired by him
          pursuant to his exercise of an option for so long as he is an
          employee;

4.8.2     shall lodge any share certificate(s) issued to him in terms of clause
          4.12.4 with the secretary of the Company until the expiry of the
          period referred to in clause 4.8.1.

4.9     Each option may only be exercised in writing and shall be signed by the
        participant concerned or, if after his death it is exercised by the
        executor(s) of his estate, by the executor(s) and:

4.9.1     must be delivered to the secretary of the Company;

4.9.2     must be accompanied by the option price in cash for the shares to
          which that exercise relates; and

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                                     Page 6

4.9.3     if it is not signed by the participant personally, must be accompanied
          by proof, to the satisfaction of the directors, of the authority of
          the signatory.

4.10    An option will lapse:

4.10.1    one year after the death of the participant; or

4.10.2    subject to clause 4.14, one year after the retirement of a participant
          or, in the case of options which the directors permit to be exercised
          by the participant as referred to in 4.7.2 such shorter period as the
          directors may have determined when giving such permission; or

4.10.3    subject to clauses 4.13 and 4.14, immediately on an employee ceasing
          to be employed as such for reasons other than death or retirement; or

4.10.4    if the interest of a participant in terms of or arising out of the
          Option Scheme is attached under any circumstances whatsoever and the
          directors pass a resolution to that effect; or

4.10.5    if the directors, in their sole discretion, consider that an employee
          has committed an act which would justify summary dismissal at common
          law or that a participant has committed an act or omitted to do
          anything which adversely affected or could adversely affect the
          interest of the Company in a material way.

4.11    Neither an option or any rights granted thereunder may be transferred,
        ceded, pledged or alienated in any way whatsoever.

4.12    The shares in respect of which each option is exercised:

4.12.1    will be fully paid;

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                                     Page 7

4.12.2    will rank pari passu with existing issued shares;

4.12.3    will be allotted and issued by the directors within 14 days after the
          exercise of the option in terms of clause 4.9;

4.12.4    will be issued to the participant to whom the option was granted as
          the beneficial owner thereof and a certificate will be issued
          therefor;

        and the directors will procure that a listing is applied therefor on the
        stock exchanges on which the Company's shares are listed and quoted.

4.13    Notwithstanding the provisions of clause 4.10.3, if a participant ceases
        to be an employee only because of retrenchment or because the
        participant's employer has sold the business in respect of which the
        participant was employed, the directors shall be entitled to determine
        that an option granted to that participant shall not lapse and shall
        remain in force on the same terms and conditions mutatis mutandis, as
        set out in the Option Scheme, provided that:

4.13.1    the directors have given written notice of that determination to the
          participant in question;

4.13.2    in the written notice referred to in clause 4.13.1 the directors shall
          be entitled, at their sole discretion, to determine that the option
          may only be exercised within a shorter period than would otherwise
          have applied;

4.13.3    the directors shall not be entitled to grant further options to such
          participant, unless such participant subsequently qualifies under
          clause 1.4; and

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                                     Page 8

4.13.4    the directors shall, notwithstanding anything contained in the Option
          Scheme, at any time in their sole discretion, be entitled to withdraw
          the notice given in terms of clause 4.13.1 by giving written notice of
          that withdrawal to the participant in question, in which event any
          option which was the subject of that notice shall lapse forthwith.

4.14    If a participant takes voluntary retirement before having reached
        pensionable age in terms of the rules of any pension and/or provident
        fund in existence for the benefit of the participant and of which the
        participant is a member, or if any participant who is not a member of
        any such fund retires (whether in terms of a service contract between
        the company and the participant concerned or otherwise) before having
        reached the prescribed retirement age, each option held by the
        participant shall immediately lapse, provided that the directors shall
        be entitled, in their sole discretion, to determine that an option
        granted to that participant shall not lapse and shall remain in force on
        the same terms and conditions, mutatis mutandis, as set out in the
        Option Scheme, provided that:

4.14.1    the directors have given written notice of that determination of the
          participant in question;

4.14.2    in the written notice referred to in clause 4.14.1 the directors shall
          be entitled, at their sole discretion, to determine that the option
          may only be exercised within a shorter period than would otherwise
          have applied;

4.14.3    the directors shall not be entitled to grant further options to such
          participant, unless such participant subsequently qualifies under
          clause 1.4; and

                                                                               8
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                                     Page 9

4.14.4    the directors shall notwithstanding anything contained in the Option
          Scheme, at any time and in their sole discretion, be entitled to
          withdraw the notice given in terms of clause 4.14.1 by giving written
          notice of that withdrawal to the participant in question, in which
          event any option which was the subject of that notice shall lapse
          forthwith.

5     GENERAL

5.1     Any dispute arising under the Option Scheme shall be referred to the
        auditors who shall decide thereon and that decision shall be final and
        binding on all parties to the dispute and may not be challenged under
        any circumstances.

5.2     The Option Scheme may, subject always to clause 5.3, be amended from
        time to time (whether retrospectively or otherwise) by the directors in
        any respect, provided that:

5.2.1     no such amendment shall operate to adversely alter the terms and
          conditions of any option granted to a participant prior thereto,
          without the written consent of that participant; and

5.2.2     the prior approval of the JSE has been obtained.

5.3     No amendment may be made to clauses 1.4, 3.1, 3.2, 4.4, 4.5 and 4.12.2
        without the approval of the Company in general meeting.

5.4     If:

5.4.1     the issued shares of the Company are consolidated or sub-divided or in
          any other way reorganised; or

5.4.2     the issued ordinary share capital of the Company is reduced;

                                                                               9
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                                     Page 10

        the number of shares which are the subject of any option and/or the
        purchase price thereof shall be adjusted in such manner as the auditors
        determine to be appropriate and in making such determination, the
        auditors shall ensure that as far as possible in the circumstances,
        participants are not prejudiced or given benefits beyond those provided
        for in the Option Scheme. The auditors shall confirm to the directors in
        writing that any such adjustments were calculated on a reasonable basis.
        The directors shall notify the participant of that adjustment which will
        be binding on the Company and on the participant.

5.5     If the Company undertakes a rights offer, each unexercised option held
        by a participant will be deemed to have been amended by adding to the
        number of shares which are the subject of the unexercised option, such
        number of shares or other securities for which the participant would
        have been entitled to subscribe in terms of the rights offer if the
        participant had been registered as a shareholder of the Company at the
        record date of the rights offer in respect of the shares which are the
        subject of the participant's unexercised options. All of the provisions
        of the Option Scheme shall apply, mutatis mutandis, to such additional
        shares or other securities provided that the price payable by the
        participant for the additional shares or other securities when the
        participant exercises the option in question shall be the price which
        would have been payable by the participant for such shares or additional
        securities if the participant had been a shareholder of the Company at
        the time of the rights offer and had subscribed for such shares or
        securities in terms of the rights offer.

5.6     If the Company allots additional shares by the capitalisation of the
        Company's profits and/or reserves and/or share premium:

                                                                              10
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                                     Page 11

5.6.1     the directors shall reserve for a participant to whom an option has
          been granted such number of shares as is equal to the additional
          capitalisation shares to which he would have been entitled had he been
          the owner of the shares which are the subject of the option at the
          date on which the capitalisation shares are allotted;

5.6.2     simultaneously with the allotment referred to in clause 4.12.3, the
          directors shall allot and issue to the participant the percentage of
          the shares reserved for him in terms of clause 5.6.1 as the number of
          shares in respect of which were the subject of the option at the date
          referred to in clause 5.6.1. The provisions of clause 4.12 shall
          apply, mutatis mutandis, to the allotment and issue referred to in
          this sub-clause 5.6.2.

5.7     The directors shall be entitled, subject to the provisions of the Option
        Scheme, to make and establish such rules and regulations and to amend
        those rules and regulations, from time to time, as they may deem
        expedient or necessary for the proper implementation and administration
        of the Option Scheme.

5.8     The Company shall summarise in its annual financial statements the
        number of shares which were available to be utilised for purposes of the
        Option Scheme at the commencement of the financial period in question,
        the number of shares in respect of which options have been granted
        during the financial period in question and the number of shares
        reserved for the Option Scheme in respect of which options have not been
        granted on the last day of the financial period in question.

5.9     Executive directors may not be appointed to administer the Option
        Scheme. At least two non-executive directors must be appointed to

                                                                              11
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                                     Page 12

        administer the Option Scheme, provided that they do not benefit from or
        participate in the Option Scheme.

                                                                              12

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