Document:

exv10w69

 

Exhibit 10.69

March 10, 2006

	To: 	 	Members of the Board of Directors and Section 16 Officers of Nortel Networks Corporation
	 
	Re: 	 	Notice of Blackout Period Under Section 306(a) of the Sarbanes-Oxley Act of 2002

Pursuant to the requirements of Section 306(a) of the Sarbanes-Oxley Act of 2002 and Regulation BTR
of the Securities and Exchange Commission (“SEC”), this memorandum is to notify you of the
immediate effectiveness of a blackout period with respect to transactions described below in common
shares and other equity securities of Nortel Networks Corporation (“Nortel”) as a result of today’s
announcement regarding the need to delay the filing of the annual reports on Form 10-K for the year
ended December 31, 2005 for Nortel and Nortel Networks Limited. In light of such announcement, all
purchases of the common shares of Nortel Networks Corporation under the Nortel employee investment
plans, stock option plans and stock purchase plans (the “Plans”) are also being suspended,
effective immediately.

The blackout period will begin immediately. You will receive written notice when the blackout
period is lifted.

During the blackout period directors and executive officers of Nortel are prohibited from
purchasing, selling, transferring or otherwise engaging in transactions involving certain Nortel
Networks Corporation common shares or other equity securities. This prohibition applies to all
equity securities of Nortel Networks Corporation and related derivative securities, including
options, share units, convertible debt securities and prepaid forward contracts. The prohibition
covers direct and indirect transactions, including those involving entities or persons through
which you have a “pecuniary interest” in the securities such as your immediate family members
living with you or securities held in trust or by controlled partnerships or corporations.

The prohibition on purchases, sales, transfers and other transactions described above applies only
to common shares of Nortel Networks Corporation (and derivatives of such securities) that you have
acquired (or in which you have a pecuniary interest) in connection with your service or employment
as a director or executive officer. It is important to note that any such security you sell or
otherwise transfer, directly or indirectly, will be presumed to have been acquired in connection
with your service or employment unless you establish that the securities were acquired from another
source, and this identification is consistent with your tax treatment of the securities and all
other disclosure and reporting requirements.

Gordon A. Davies

General Counsel — Corporate and Corporate Secretary

T. 905-863-1144      F. 905-863-8386      gadavies@nortel.com

8200 Dixie Road, Suite 100, Brampton, Ontario, Canada L6T 5P6

 

 

There are certain very narrow exceptions to this prohibition. I strongly recommend that you
consult me before entering into any transaction pursuant to a possible exception.

Once this blackout period ends, you will be permitted to resume transactions in Nortel Networks
Corporation common shares and other equity securities subject to the requirements of Nortel’s
Insider Trading Policies and applicable law.

Please note that Nortel has determined in accordance with Rule 104 of SEC Regulation BTR that it
was unable to provide advance notice of this blackout.

If you have any questions regarding the blackout period, you may contact me at the following
address or phone number:

Gordon A. Davies

Nortel Networks Corporation

8200 Dixie Road, Suite 100

Brampton, Ontario L6T 5P6 Canada

905-863-1144 (phone)

Yours truly,

/s/  Gordon A. Davies

Gordon A. Davies

-2-EXHIBIT 4.1 

OPTION AGREEMENT 

        OPTION
AGREEMENT dated this 29th day of June, 2005 between QSound Labs, Inc., a body
corporate, continued under the laws of the Province of Alberta, having its head office at
400 – 3115 12th Street NE, Calgary, AB T2E 7J2 (the “Company”)
and M. Patty Chakour, 5742 E. LeMarche Avenue, Scottsdale, AZ 85254 (the
“Optionee”); 

        WHEREAS
the Optionee is an outside director of the Company, and the Company has approved the grant
of incentive stock options to compensate outside directors for their services; 

        In
consideration of the premises and of the mutual covenants and agreements herein contained,
the parties hereby covenant and agree as follows: 

     1.    
          Grant of Option. Subject to shareholder approval, the Company hereby
          grants to the Optionee, outside of the 1998 Stock Option Plan, the
          irrevocable option to purchase common shares without par value in the capital of
          the Company, or any part thereof, as follows (“Option”): 

	  	
Number of shares:

Exercise price:  

Expiry Date:     

Vesting:         

	
10,000                                                                          

$3.57 US per share                                                              

June 28, 2010                                                                   

The Option shall vest in accordance with the following schedule, provided
however that no vesting may take place until shareholder approval for the Option
 

	  	
 	
July 29, 2005   

October 29, 2005

January 29, 2006

April 29, 2006  	
2500

2500

2500

2500 

     2.    
          Exercise of Option. Subject to section 4. hereof, the Optionee may
          exercise the Option at any time or from time to time by giving written notice to
          the Company substantially in the form attached hereto as Schedule “A”
          and delivering to the Company a certified cheque in an amount equal to the
          number of common shares in respect of which the Option is being exercised
          multiplied by the exercise price specified in section 1. hereof. 

     3.    
          Optionee’s Representation. The Optionee hereby confirms and
          represents that she is a director of the Company at the date hereof. 

     4.    
          Entitlement to Exercise Not withstanding any other provision hereof, the
          Optionee shall only be entitled to exercise the Option while a director of the
          Company, or during a period commencing on the date on which the Optionee ceases
          to be a director and ending on the earlier of 30 days thereafter and the Expiry
          Date, or on such later date as may be determined by the Board of Directors. 

     6.    
          Exercise by Personal Representative In the event of the Optionee’s
          death while a director of the Company, the personal representative of the
          Optionee shall be entitled to exercise the Option in whole or in part as to any
          shares not previously purchased hereunder by giving written notice to the
          Company and paying the purchase price to the Company during a period commencing
          on the date of death of the Optionee and ending on the earlier of one year
          thereafter and the Expiry Date, or on such later date as may be determined by
          the Board of Directors. 

     7.    
          Fully Paid Shares All common shares purchased by the Optionee hereunder
          shall be fully paid and non-assessable common shares. 

     8.    
          Adjustment The number of common shares subject to the Option shall be
          increased or decreased proportionately in the event of the subdivision or
          consolidation of common shares of the Company, and in any event a corresponding
          adjustment shall be made changing the number of shares deliverable upon the
          exercise of the Option 

without change in the total price
applicable to the unexercised portion of the option, but with a corresponding adjustment
in the price for each share covered by the Option. In case the Company is reorganized or
merged or consolidated or amalgamated with another corporation, appropriate provisions
shall be made for the continuance of the Option and to prevent its dilution or
enlargement. 

     9.    
          No Registration The Optionee understands that the common shares to be
          issued pursuant to the option may not be registered under the United States
          Securities Act of 1933 (the “Act”) in reliance upon an exemption from
          the registration requirements thereof pursuant to Section 4(2) of the Act. The
          Optionee agrees to execute and deliver any and all documents at the time of
          exercise of the Option as may be necessary to assure compliance with U.S.
          federal and state and Canadian provincial securities laws. The Optionee
          understands that the Company shall not be required to register any common shares
          acquired by the Optionee and that the Optionee may be required to hold such
          common shares indefinitely in the absence of registration or an exemption from
          registration under the United States federal or state securities laws. 

     10.    
          Legend The Optionee acknowledges that all common shares issued pursuant
          hereto may bear the following legends (which may be modified from time to time
          in such manner as the Company’s attorneys recommend): 

	  	
“THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER UNITED STATES FEDERAL OR
STATE SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED OR
ASSIGNED FOR VALUE, DIRECTLY OR INDIRECTLY, NOR MAY THE SECURITIES BE TRANSFERRED ON THE
BOOKS OF THE CORPORATION, WITHOUT REGISTRATION OF SUCH SECURITIES UNDER ALL APPLICABLE
UNITED STATES FEDERAL OR STATE SECURITIES LAWS OR COMPLIANCE WITH AN APPLICABLE EXEMPTION
THEREFROM, SUCH COMPLIANCE, AT THE OPTION OF THE CORPORATION, TO BE EVIDENCED BY AN
OPINION OF SECURITYHOLDER’S COUNSEL, ACCEPTABLE TO THE CORPORATION, THAT NO VIOLATION
OF SUCH REGISTRATION PROVISIONS WOULD RESULT FROM ANY PROPOSED TRANSFER OR
ASSIGNMENT.” 

     11.    
          Amendment If the approval of the Company’s shareholders to any
          amendment to this Agreement shall be required by the prevailing policies of the
          regulatory securities bodies having jurisdiction over the Company, then any
          amendment made to this Agreement shall be subject to the approval of the
          shareholders of the Company. 

     12.    
          Time of the Essence Time shall be essence hereof. 

        IN
WITNESS WHEREOF the parties hereto have executed there presents on the day and year
first above written. 

QSOUND LABS, INC. 

Per:  /s/ David Gallagher  

       ___________________________________

/s/ M. Patty Chakour

______________________________________

OPTIONEE 

SCHEDULE A  

QSound Labs, Inc. 

400 – 3115 12th Street NE

Calgary, AB T2E 7J2 

Attention:   Secretary 

Dear Sirs: 

	  	Re:  	  	Exercise
of Stock Option 

        The
undersigned, being the holder of an option to purchase common shares of QSound Labs, Inc.
(the “Company”) does hereby elect to exercise such option to the extent of the
purchase of common shares at the exercise prices of $ per share and does hereby tender to
the Company the total purchase price of $  therefor. 

        The
undersigned acknowledges that if common shares issued pursuant hereto may not be
registered pursuant to applicable securities laws of the United States, any certificate
representing such shares will bear a legend in a form which may be approved by the
Company’s counsel and the undersigned consents to the imposition of any such legend. 

Yours truly, 

______________________________

OPTIONEE 

DATED this ____ day of __________________, 200_.

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