Document:

EXECUTIVE
      EMPLOYMENT AGREEMENT

     

    This
      Executive Employment Agreement (this “Agreement”) is
      made
      and entered into as of
      this
      20th day of August, 2007 (the “Effective
      Date”) by
      and
      between New Motion, Inc., a Delaware corporation (the “Company”) and
      Susan
      G. Swenson (“Executive”).

     

    
      	 	
              1.

            	
              Engagement
                and Duties

            

    

     

    1.1 Commencing
      as of the Effective Date, and upon the terms and subject to the conditions
      set
      forth in this Agreement, the Company hereby engages and employs Executive as
      an
      officer of the Company, with the title and designation of Chief Operating
      Officer of the Company. Executive hereby accepts such engagement and
      employment.

     

    1.2 Executive's
      duties and responsibilities shall be those normally and customarily vested
      in
      the office of Chief Operating Officer of a corporation, subject to the
      supervision, direction, control, and discretion of the Chief Executive Officer
      of the Company. 

     

    1.3 Executive
      agrees to devote her primary business time, energies, skills, efforts and
      attention to her duties hereunder, and will not, without the prior written
      consent of the CEO and the Board, render any material services to any other
      for-profit business concern. The Company acknowledges, and accepts that, the
      Executive currently sits on the corporate boards of Wells
      Fargo, mBox and Eltek and
      will
      continue to sit on such boards so long as there is no stated, direct conflict
      between those respective corporations and the Company’s primary business
      activities. Executive will use her best efforts and abilities faithfully and
      diligently to promote the Company's business interests.

     

    1.4 Except
      for travel incident to the business of the Company, Executive shall perform
      her
      duties and obligations under this Agreement principally from an office provided
      by the Company in Irvine, California.

     

    2. Term
      of Employment.
      Executive's employment pursuant to this Agreement shall commence on the
      Effective Date and shall terminate on the earliest to occur of the following
      (in
      any case, the “Term”):

     

    2.1 the
      close
      of business on the second (2nd) anniversary of the Effective Date, provided,
      that if the Company has not given Executive written Notice (as defined below)
      of
      its decision not to renew the Term on or before ninety (90) days prior to the
      end of the two year Term then, unless otherwise terminated as provided below,
      the Term shall be automatically extended until the earlier of (i) a date which
      is ninety (90) days following the Company's delivery to Executive of written
      Notice of the Company's decision not to renew this Agreement beyond such date,
      and (ii) December 31, 2009;

     

    2.2 the
      death
      of Executive;

     

    2.3 delivery
      to Executive of written Notice of termination by the Company if Executive
      suffers a “Permanent Disability,” which for purposes of this Agreement shall
      mean a condition that entitles Executive to benefits under an applicable Company
      long-term disability plan or, if no such plan exists, a physical or mental
      disability which, in the reasonable judgment of the CEO or the Board, is likely
      to render Executive unable to perform her duties and obligations under this
      Agreement for 60 days in any 12-month period;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    2.4 delivery
      to Executive of written Notice of termination by the Company for “Cause,”
      which Notice shall identify the particular details of the conduct that the
      Company believes
      constitutes Cause. For purposes of this Agreement, “Cause” shall mean: (i) any
      act or omission knowingly undertaken or omitted by Executive with the intent
      of
      causing damage to the Company,
      its properties, assets or business or its stockholders, officers, directors
      or
      employees; (ii)
      any
      fraud, misappropriation or embezzlement by Executive resulting in a material
      personal profit
      to
      Executive, in any case, involving properties, assets or funds of the Company
      or
      any of its
      subsidiaries; (iii) Executive's consistent failure to materially perform her
      normal duties as described
      in Section
      1.2,
      other
      than any such failure resulting from Executive's Permanent Disability;
      (iv) conviction of, or pleading nolo contendere to, (A) any crime or offense
      involving monies or other property of the Company; or (B) any felony offense
      involving a crime of moral turpitude;
      or (v) Executive's chronic or habitual use or consumption of drugs or alcoholic
      beverages,
      in either case, that causes material damage to the Company, its properties,
      assets or business,
      provided,
      that
      to
      the extent any circumstances that would otherwise constitute Cause shall
      be
      capable of cure, Executive shall be given notice from the CEO or the Board
      of
      Directors and no less than thirty days to cure such circumstances prior to
      any
      termination of her
      employment
      for Cause;

     

    2.5 delivery
      to Executive of written Notice of termination by the Company “without
      Cause;”

     

    2.6 delivery
      to the Company of written Notice of termination by Executive for “Good
      Reason,” by
      reason
      of: (i) the material diminution of Executive's duties, job title or
      responsibilities as provided in Section
      1 above;
      (ii) a relocation of Executive's principal work location to a location that
      is
      more than 60 miles from the location set forth in Section
      1.4
      above;
      or (iii) a material breach by the Company of this Agreement, including without
      limitation, a material reduction in any component of Executive's compensation
      or
      benefits as provided for herein; or

     

    2.7 delivery
      to the Company of written Notice of Termination by Executive without “Good
      Reason.”

     

    
      	 	
              3.

            	
              Compensation:
                Executive Benefit
                Plans

            

    

     

    3.1 The
      Company shall pay to Executive a base salary (the “Base
      Salary”)
      at an
      annual rate of $300,000 for the period commencing on the Effective Date and
      ending on the first (1st) anniversary of the Effective Date. At the commencement
      of each subsequent twelve (12) month period during the Term, the “Base Salary”
shall increase by no less than 5% (five percent) per annum from the previous
      year. The Base Salary shall be payable in installments throughout the year
      in
      the same manner and at the same times the Company pays base salaries to
      similarly situated executive officers of the Company, but in any event, no
      less
      frequently than monthly.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    3.2 Commencing
      with fiscal year 2007 and for each fiscal year during the Term
      thereafter during which Executive is performing services to the Company, the
      Company shall
      maintain a Management Incentive Program, pursuant to which the Company will
      set
      aside in
      a fund
      a discretionary amount to be determined by the Company’s Board of Directors
      based upon of the Company's EBIT for such fiscal year (the “MIP
      Fund”). Executive
      and such other members of management as determined by the Board of Directors
      shall be paid a bonus (the “EBIT
      Bonus”).
      Executive's EBIT Bonus target for the fiscal years ending December 31, 2007
      and
      December 31, 2008 will be no less than 15 (fifteen) percent of the MIP Fund.
      As
      a percentage of the MIP Fund, this target will increase at no less than 5%
      per
      year so long as Executive remains employed with the Company. For purposes
      hereof, “EBIT” shall mean earnings before interest and taxes, calculated based
      on the Company's audited consolidated financial statements for the applicable
      fiscal year prepared in accordance with generally accepted accounting principles
      in the United States. Executive's EBIT Bonus for fiscal year 2007 will be pro
      rated for the number of days Executive is employed hereunder in fiscal 2007.
      The
      EBIT Bonus, if any, shall be payable in cash or cash equivalent by April 15
      of
      the year immediately following the fiscal year for which such EBIT Bonus is
      calculated.

     

    3.3 During
      the Term, Executive shall be entitled each year to vacation for a minimum
      of three calendar weeks (pro-rated for any partial year of service during the
      Term), plus
      such
      additional period or periods as the Board may approve in the exercise of its
      reasonable discretion, during which time her
      compensation
      shall be paid in full. To the extent that Executive does
      not
      use any such vacation during any year, up to two calendar weeks of such unused
      vacation
      shall be carried over from year to year; provided, however,
      that in
      no event shall Executive's
      total accrued but unused vacation at any time exceed five weeks.

     

    3.4 As
      an
      inducement to Executive to accept this Agreement and serve as Chief Operating
      Officer of the Company, upon approval by the Company’s Board of Directors,
      Executive will be granted 75,000 shares of Restricted Common Stock of the
      Company (the “Common Stock”) (the “Inducement Grant”). The Inducement Grant
      shall be granted pursuant to Company’s 2007 Stock Incentive Plan. Company and
      Executive hereby agree to determine a mutually agreeable vesting schedule for
      such Inducement Grant within 90 days from the Effective Date of this Agreement.
      Consistent with Section
      5.1(iii)
      below,
      the Stock Purchase Agreement covering the Inducement Grant (the “Stock Purchase
      Agreement”) will provide for the full acceleration of all applicable vesting
      requirements upon (i) a change of control of the Company, as to be defined
      in
      the Stock Purchase Agreement and (ii) upon a termination of Executive’s
      employment Without Cause, for Good Reason, or due to Executive’s death or
      Permanent Disability.

     

    3.5 During
      the Term, the Company shall pay to Executive, in increments payable at the
      times
      that the Company pays the Base Salary to Executive, an allowance of $700 per
      month for costs associated with the lease or purchase, maintenance and insurance
      of an automobile, and an additional allowance of $300 per month for costs
      associated with use of cellular equipment and mobile communication service
      or
      subscriptions or fees.

     

    
      
        
        

      

      
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    3.6 During
      the Term, Executive shall be entitled to reimbursement from the Company for
      the
      reasonable costs and expenses which she incurs in connection with the
      performance of her duties and obligations under this Agreement, substantiated
      in
      a manner consistent with the Company's practices and policies as adopted or
      approved from time to time by the Board for executive officers. For the
      avoidance of doubt, “business class” travel shall constitute reasonable costs
      and expenses on any flight greater than six (6) hours in duration.

     

    3.7 The
      Company may deduct from any compensation payable to Executive the minimum
      amounts sufficient to cover applicable federal, state and/or local income and
      employment tax withholding.

     

    4. Other
      Benefits.
      During
      the Term, Executive shall be eligible to participate in all operative employee
      compensation, fringe benefit and perquisite, and other benefit and welfare
      plans
      or arrangements of the Company then in effect from time to time and in which
      similarly situated executive officers of the Company generally are entitled
      to
      participate, including without limitation, to the extent then in effect,
      incentive, group life, medical, dental, prescription, disability and other
      insurance plans, all on terms at least as favorable as those offered to
      similarly situated executives of the Company. The Company will provide
      Executive, Director and Officer Liability coverage of no less than two million
      dollars as set forth in Section
      13.5
      below.

     

    5. Termination
      of Employment.
      Subject
      to the provisions of this Section
      5,
      either
      the Company or Executive may terminate Executive's employment at any time for
      any reason or no reason. The following provisions shall control any such
      termination of Executive's employment.

     

    5.1 Termination
      Without Cause, for Good Reason, or due to Executive's death or Permanent
      Disability.
      The
      Company may terminate Executive's employment without Cause at any time upon
      15
      days' prior written Notice to Executive, and Executive may terminate her
      employment with Good Reason at any time upon 15 days' prior written Notice
      to
      the Company, in each case, subject to any applicable cure periods (in the case
      of a termination without Cause or for Good Reason, the date specified in any
      such Notice in accordance with this Section
      5.1
      shall
      constitute the “Date
      of Termination”).
      For
      purposes of clarity, the Company's delivery of Notice in accordance with Section
      2(a) of its decision not to renew the Term shall not constitute termination
      without Cause, and shall be governed by Section
      5.5
      below.
      Executive's employment shall also terminate upon the occurrence of Executive's
      death or Permanent Disability (in the case of a termination due to Executive's
      death or Permanent Disability, the date of the death or the date specified
      in a
      Notice from the Company indicating termination due to Permanent Disability
      shall
      constitute the “Date
      of Termination”).
      If
      Executive's employment is terminated pursuant to this Section
      5.1,
      the
      Company shall promptly, or in the case of obligations described in clause (e)
      below, as such obligations become due to Executive, pay or provide to Executive
      (or her estate), (a) Executive's earned but unpaid Base Salary accrued through
      such Date of Termination, (b) accrued but unpaid vacation time through such
      Date
      of Termination, (c) any EBIT Bonus required to be paid to Executive pursuant
      to
      this Agreement for any fiscal year of the Company ending prior to the Date
      of
      Termination, to the extent payable, but not previously paid, (d) reimbursement
      of any business expenses incurred by Executive prior to the Date of Termination
      that are reimbursable under Section
      3.6
      above,
      and (e) any vested benefits and other amounts due to Executive under any plan,
      program, policy of, or other agreement with, the Company (together, the
“Accrued
      Obligations”).
      In
      addition, Executive (or her estate) shall be entitled to the following payments
      and benefits (the “Severance”)
      from
      the Company:

     

    
      	 	
              (i)

            	
              payment,
                at the time and in the manner specified in Section
                5.2 below,
                of an aggregate amount equal to Executive's Base Salary (at
                the rate then in effect, but disregarding any reduction of Base
                Salary
                in violation of this Agreement) that would have been payable
                to the Executive had she remained employed by the Company
                for the period (such period, or the period described in the next
                sentence, as applicable, the “Severance
                Period”)
                commencing
                on the Date of Termination and ending on the second anniversary of
                the
                Effective Date or, if later, the date which is three (3) months following
                delivery by the Company of Notice of its decision not to extend the
                Term
                (as contemplated by Section
                2(a),
                which Notice, if not previously given, shall be deemed to be given
                on the
                Date of Termination for any reason other than death or Permanent
                Disability). If termination occurs due to death or Permanent
                Disability, then such amount shall be equal to the Base Salary
                that would have been payable to the Executive had she remained
                employed by the Company through the second
                anniversary of the Effective Date. The Severance payable to the Executive
                pursuant to this paragraph (i) is hereinafter referred to as the
                “Base
                Salary Severance”;

            

    

     

    
      
        
        

      

      
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              (ii)

            	
              payment,
                at the time specified in Section
                5.2
                below, of a pro rated portion of the EBIT Bonus for the fiscal year
                in
                which the Date of Termination occurs, where such pro rated portion
                is
                equal to: (a) the amount contributed to the MIP Fund, if any, for
                the
                period (the “EBIT
                Period”)
                from January 1 of the applicable fiscal year through the last day
                of the
                fiscal quarter in which such Date of Termination occurs, multiplied
                by (b)
                the ratio determined by dividing the number of days Executive was
                employed
                during the EBIT Period by the total number of days in the EBIT Period,
                multiplied by (c) Executive's percentage of the MIP
                Fund;

            

    

     

    
      	 	
              (iii)

            	
              as
                of the Date of Termination, the Inducement Grant will fully vest;
                and
                

            

    

     

    
      	 	
              (iv)

            	
              continued
                healthcare coverage for Executive (if living) and her dependents
                for the
                Severance Period, to the extent each such individual received healthcare
                coverage immediately prior to such termination of employment, at
                the same
                cost to Executive and her dependants as such coverage cost immediately
                prior to such termination of employment (subject to premium increases
                affecting participants in such plans generally), provided that if
                the
                Board determines, in its sole discretion, that it is necessary or
                advisable for Executive to elect continuation of healthcare coverage
                under
                Section 4980B of the Code and the regulations hereunder in order
                for the
                Company to provide such coverage under its healthcare plans, and
                the
                Company so notifies the Executive, Executive hereby agrees to make
                such an
                election. For the avoidance of doubt, if the Company requires that
                Executive elect continuation coverage under Section 4980B of the
                Code,
                such coverage shall nevertheless be provided to Executive and her
                dependents (as described above) at the same cost to Executive and
                her
                dependents as was paid for medical coverage immediately prior to
                Executive's termination of
                employment.

            

    

     

    
      
        
        

      

      
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    5.2 Timing
      of Payment.
      The
      Company shall make payment of the amounts specified in clauses (i) and (ii)
      of
Section
      5.1
      as
      follows:

     

    
      	 	
              (i)

            	
              with
                respect to the Base Salary Severance, (a) 50% of such amount shall
                be paid
                on the date of Executive's “separation from service” within the meaning of
                Section 409A(a)(2)(A)(i) of the Code (a “separation from service”), and
                (b) 50% of such amount shall be paid in equal installments on the
                first
                day of each of the twelve (12) calendar months immediately following
                such
                separation from service; and

            

    

     

    
      	 	
              (ii)

            	
              the
                EBIT Bonus amount contemplated by clause (ii) of Section
                5.1 shall
                be
                paid on the date that is 50 calendar days following the last day
                of the
                fiscal quarter during which Executive's separation from service
                occurs.

            

    

     

    5.3 Cause.
      If
      Executive's employment becomes terminable by the Company for Cause, the Company
      may terminate Executive's employment immediately (subject to the cure rights
      described above) and Executive shall be entitled to receive the Accrued
      Obligations upon the Date of Termination, or, in the case of benefits described
      in Section
      5.1(e),
      as such
      obligations become due to Executive.

     

    5.4 Resignation.
      Executive may terminate her employment without Good Reason upon thirty (30)
      days' Notice to the Company. If Executive so terminates her employment,
      Executive shall be entitled to receive the Accrued Obligations promptly, or,
      in
      the case of benefits described in Section
      5.1(e),
      as such
      obligations become due to Executive.

     

    5.5 Non-Renewal.
      In the
      event that either the Company or the Executive elects not to renew the Term
      in
      accordance with Section
      2(a),
      Executive shall be entitled to receive the Accrued Obligations upon the Date
      of
      Termination, or, in the case of benefits described in Section
      5.1(e),
      as such
      obligations become due to Executive. In addition, Executive shall be entitled
      to
      receive payment of a pro rated portion of the EBIT Bonus for the EBIT Period
      in
      the manner contemplated by Section
      5.1(ii)
      and at
      the time specified in Section
      5.2(ii).

     

    
      
        
        

      

      
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    5.6 Six-Month
      Delay.
      Notwithstanding anything to the contrary in this Agreement, no Severance
      payments or benefits shall be paid to Executive during the six-month period
      following the Executive's separation from service to the extent that the Company
      and the Executive mutually determine in good faith that paying such amounts
      at
      the time or times indicated in this Section 5 would cause the Executive to
      incur
      an additional tax under Section 409A of the Code (in which case such amounts
      shall be paid at the time or times indicated in this Section
      5.6).
      If the
      payment of any such amounts are delayed as a result of the previous sentence,
      then on the first day following the end of such six-month period, the Company
      will pay the Executive a lump-sum amount equal to the cumulative amount that
      would have otherwise been payable to the Executive during such six-month
      period.

     

    
      	 	
              6.

            	
              Confidentiality
                of Proprietary Information and
                Material

            

    

     

    6.1 Industrial
      Property Rights.
      For the
      purpose of this Agreement, “Industrial
      Property Rights”
shall
      mean all of the Company's patents, trademarks, trade names, inventions,
      copyrights, know-how, formulas and science, now in existence or hereafter
      developed or acquired by the Company or for its use, relating to any and all
      products and services which are developed, formulated and/or manufactured by
      the
      Company.

     

    6.2 Trade
      Secrets.
      For the
      purpose of this Agreement, “Trade
      Secrets” shall
      mean
      any
      formula, pattern, device, or compilation of information that is used in the
      Company's business and gives the Company an opportunity to obtain an advantage
      over its competitors who do not know and/or do not use it and for which the
      Company takes reasonable precautions to maintain
      the confidentiality of such information. This term includes, but is not limited
      to, information
      relating to the marketing of the Company's products and services, including
      price lists,
      pricing information, customer lists, customer names, the particular needs of
      customers, information
      relating to their desirability
      as
      customers, financial information, intangible property and other such information
      which is not in the public domain.

     

    6.3 Technical
      Data.
      For the
      purpose of this Agreement, “Technical
      Data” shall
      mean all information of the Company in written, graphic or tangible form
      relating to any and
      all
      products which are developed, formulated and/or manufactured by the Company,
      as
      such information
      exists as of the Effective Date or is developed by the Company during the term
      hereof.

     

    6.4 Proprietary
      Information.
      For the
      purpose of this Agreement, “Proprietary
      Information” shall
      mean all of the Company's Industrial Property Rights, Trade Secrets and
      Technical Data. Proprietary Information shall not include any information which
      (i) was lawfully in the possession of Executive prior to Executive's employment
      with the Company, (ii) may be obtained by a reasonably diligent businessperson
      from readily available and public sources of information, (iii) is lawfully
      disclosed to Executive after termination of Executive's employment by a third
      party which does not have an obligation to the Company to keep such information
      confidential, or (iv) is independently developed by Executive without utilizing
      any of
      the
      Company's Proprietary Information.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    6.5 Agreement
      Not To Copy Or Use.
      Executive agrees, at any time during the term of her employment and for a period
      of ten years thereafter, not to copy, use or disclose (except
      (i) as required, authorized or permitted in connection with the performance
      of
      her services
      to the Company, (ii) as required by law after first notifying the Company and
      giving it an
      opportunity to object, or (iii) as required to enforce Executive's rights under
      this Agreement) any
      Proprietary Information without the Company's prior written permission. The
      Company may
      withhold such permission as a matter within its sole discretion during the
      term
      of this Agreement and thereafter. 

     

    7. Return
      of Corporate Property.
      Upon
      any termination of this Agreement, Executive shall turn over to the Company
      all
      property, writings or documents then in her possession or custody belonging
      to
      or relating to the affairs of the Company or comprising or relating to any
      Proprietary Information.

     

    8. Discoveries
      and Inventions

     

    8.1 Disclosure.
      Executive will promptly disclose in writing to the Company complete information
      concerning each and every invention, discovery, improvement, device, design,
      apparatus, practice, process, method, product or work of authorship, in any
      case, relating to the business, products, practices, techniques or confidential
      information of the Company, whether patentable or not, made, developed,
      perfected, devised, conceived or first reduced to practice by Executive,
      (hereinafter referred to as “Developments”),
      either solely or in collaboration with others, (a) prior to the Term while
      working for the Company, (b) during the Term or (c) within six months after
      the
      Term.

     

    8.2 Assignment.
      Executive,
      to the extent that she has the legal right to do so, hereby
      acknowledges that any and all Developments that are created during the Term,
      are
      the property of the Company and hereby assigns and agrees to assign to the
      Company any and all of Executive's
      right, title and interest in and to any and all of such Developments;
provided,
      however,
      that,
      in accordance with California Labor Code Sections 2870 and 2872, the provisions
      of this Section
      8.2 shall
      not
      apply to any Development that Executive developed entirely on her own time
      without using the Company's equipment, supplies, facilities or trade secret
      information except for those Developments that either:

     

    
      	 	
              (i)

            	
              relate
                at the time of conception or reduction to practice of the Development
                to
                the Company's business, or actual or demonstrably anticipated research
                or
                development of the Company; or,

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (ii)

            	
              result
                directly from any work performed by Executive for the
                Company.

            

    

     

    8.3 Assistance
      of Executive.
      Upon
      the Company's request and at no expense to Executive, whether during the Term
      or
      thereafter, Executive will do all reasonable lawful acts, including, but not
      limited to, the execution of papers and lawful oaths and the giving of
      testimony, that, in the reasonable opinion of the Company, its successors and
      assigns, may be necessary or desirable in obtaining, sustaining, reissuing,
      extending and enforcing United States and foreign Letters Patent, including,
      but
      not limited to, design patents, on any and all Developments and for perfecting,
      affirming and recording the Company's complete ownership and title thereto,
      subject to the proviso in Section 8.2 hereof, and Executive will otherwise
      reasonably cooperate in all proceedings and matters relating
      thereto.

     

    8.4 Records.
      Executive will keep complete and accurate accounts, notes, data and
      records of all Developments in the manner and form reasonably requested by
      the
      Company. Such
      accounts, notes, data and records shall be the property of the Company, subject
      to the proviso
      in Section
      8.2 hereof,
      and, upon written request by the Company, Executive will promptly
      surrender the same to it.

     

    8.5 Obligations,
      Restrictions and Limitations.
      Executive understands that the Company
      may enter into agreements or arrangements with agencies of the United States
      Government
      and that the Company may be subject to laws and regulations which impose
obligations,
      restrictions and limitations on it with respect to inventions and patents which
      may be acquired by it or which may be conceived or developed by employees,
      consultants or other agents rendering services to it. Executive agrees that
      she
      shall be bound by all such obligations, restrictions
      and limitations applicable to any such invention conceived or developed by
      him
during
      the Term and shall take any reasonable action which may be required to discharge
      such obligations and to comply with such restrictions and
      limitations.

     

    9. Non-solicitation
      Covenant

     

    9.1 Nonsolicitation
      and Noninterference.
      For two
      years following termination of this Agreement, Executive shall not (a) induce
      or
      attempt to induce any employee of the Company to leave the employ of the
      Company, (b) induce or attempt to induce any employee of the Company to work
      for, render services or provide advice to or supply confidential business
      information or Trade Secrets of the Company to any third person, firm or
      corporation, or (c) induce or attempt to induce any customer, supplier,
      licensee, licensor or other business relation of the Company to cease doing
      business with the Company, provided, that advertisements and general
      solicitations shall not constitute a breach of this Section 9.1.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    9.2 Indirect
      Solicitation.
      Executive agrees that, during the period covered by Section
      9.1 hereof,
      she will not, directly or indirectly, assist or encourage any other person
      in
carrying
      out, directly or indirectly, any activity that would be prohibited by the
      provisions of Section
      9.1 if
      such
      activity were carried out by Executive, either directly or indirectly; and,
      in
      particular, Executive agrees that she will not, directly or indirectly, induce
      any employee of the Company to carry out, directly or indirectly, any such
      activity.

     

    10. Injunctive
      Relief.
      Executive hereby recognizes, acknowledges and agrees that in the event of any
      breach by Executive of any of her covenants, agreements, duties or obligations
      contained in Sections
      6, 7, 8 and 9
      of this
      Agreement, the Company would suffer great and irreparable harm, injury and
      damage, the Company would encounter extreme difficulty in attempting to prove
      the actual amount of damages suffered by the Company as a result of such breach,
      and the Company would not be reasonably or adequately compensated in damages
      in
      any action at law. Executive therefore covenants and agrees that, in addition
      to
      any other remedy the Company may have at law, in equity, by statute or
      otherwise, in the event, of any breach by Executive of any of her covenants,
      agreements, duties or obligations contained in Sections
      6, 7, 8 and 9
      of this
      Agreement, the Company shall be entitled to seek and receive temporary,
      preliminary and permanent injunctive and other equitable relief from any court
      of competent jurisdiction to enforce any of the duties or obligations contained
      in Sections
      6, 7, 8 and 9
      of this
      Agreement without the necessity of proving the amount of any actual damage
      to
      the Company or any affiliate thereof resulting there from; provided, however,
      that nothing contained in this Section
      10
      shall be
      deemed or construed in any manner whatsoever as a waiver by the Company of
      any
      of the rights which the Company may have against Executive at law, in equity,
      by
      statute or otherwise arising out of, in connection with or resulting from the
      breach by Executive of any of her covenants, agreements, duties or obligations
      hereunder.

     

    11. Code
      Section 409A.
      Certain
      amounts under this Agreement may constitute “nonqualified
      deferred compensation” which is intended to comply with the requirements of
Section
      409A of the Code. To the extent that the parties reasonably determine that
      any
compensation
      or benefits payable under this Agreement are subject to Section 409A of the
      Code, this Agreement shall incorporate the terms and conditions required by
      Section 409A of the Code and Department of Treasury regulations as reasonably
      determined by the Company and the Executive.
      To the extent applicable, this Agreement shall be interpreted in accordance
      with
Section
      409A of the Code and Department of Treasury regulations and other interpretative
      guidance
      issued hereunder.
      In the
      event that following the Effective Date, the Company and the Executive
      reasonably determine that any compensation or benefits payable under this
      Agreement may be subject to Section 409A of the Code and related Department
      of
      Treasury guidance, the Company and the Executive shall work together to adopt
      such amendments to this Agreement or adopt
      other policies or procedures (including amendments, policies and procedures
      with
retroactive
      effective), or take any other commercially reasonable actions necessary or
      appropriate to (a) exempt the compensation and benefits payable under this
      Agreement from Section 409A of the Code and/or preserve the intended tax
      treatment of the compensation and benefits provided with respect to this
      Agreement, or (b) comply with the requirements of Section 409A of the Code
      and
      related Department of Treasury guidance.

     

    12. Code
      Section 280G.
      If
      any
      payment or benefit received or to be received by Executive in connection with
      a
“change in ownership or control” of the Company (within the meaning of Section
      280G of the Code), whether payable pursuant to the terms of this Agreement
      or
      any
      other plan, arrangement or agreement with the Company or an affiliate of the
      Company (the
      “Payments”),
      would
      constitute a “parachute payment” within the meaning of Section 280G of
      the
      Code, the Payments shall be reduced to the extent necessary so that no portion
      thereof shall
      be
      subject to the excise tax imposed by Section 4999 of the Code but only if,
      by
      reason of such reduction, the net after-tax benefit to Executive shall exceed
      the net after-tax benefit to Executive if no such reduction was made. For
      purposes of this Section
      12, “net
      after-tax benefit” shall
      mean (i) the total of all payments and the value of all benefits which Executive
      receives or is
      then
      entitled to receive from the Company that would constitute “parachute payments”
within the
      meaning of Section 280G of the Code, less (ii) the amount of all federal, state
      and local income
      taxes payable with respect to the foregoing calculated at the maximum marginal
      income tax
      rate
      for each year in which the foregoing shall be paid to Executive (based on the
      rate in effect
      for such year as set forth in the Code as in effect at the time of the first
      payment of the foregoing),
      less (iii) the amount of excise taxes imposed with respect to the payments
      and
benefits
      described in (i) above by Section 4999 of the Code. The foregoing determination
      will be
      made
      by a nationally recognized accounting firm (the “Accounting
      Firm”) selected
      by Executive
      and reasonably acceptable to the Company, provided,
      that
      the
      Accounting Firm's determination
      shall be made based upon “substantial authority” within the meaning of Section
6662
      of
      the Code. The Accounting Firm shall provide Executive and the Company with
      its
      determinations and detailed supporting calculations with respect thereto at
      least 15 business days prior
      to
      the date on which Executive would be entitled to receive a Payment (or as soon
      as practicable
      in the event that the Accounting Firm has less than 15 business days advance
      notice that Executive may receive a Payment) in order that Executive may
      determine whether it is in Executive's best interest to waive the receipt of
      any
      or all amounts which may constitute “excess parachute payments.” If the
      Accounting Firm determines that such reduction is required by this Section
      12, Executive,
      in her sole and absolute discretion, may determine which of the Payments
shall
      be
      reduced to the extent necessary so that no portion thereof shall be subject
      to
      the excise tax
      imposed by Section 4999 of the Code, and the Company shall pay such reduced
      amount to Executive.
      Executive and the Company shall each provide the Accounting Firm access to
      and
copies
      of
      any books, records, and documents in the possession of Executive or the Company,
      as the case may be, reasonably requested by the Accounting Firm, and otherwise
      cooperate with the Accounting Firm in connection with the preparation and
      issuance of the determinations and calculations
      contemplated by this Section
      12.
      The
      first $5,000 of fees and expenses of the Accounting
      Firm for its services in connection with the determinations and calculations
      contemplated
      by this Section
      12 will
      be
      borne exclusively by the Company, and the balance of any
      such
      fees and expenses, if any shall be borne exclusively by Executive.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    13. Miscellaneous

     

    13.1 Arbitration.
      The
      parties agree that they will use their best efforts to amicably resolve any
      dispute arising out of or relating to this Agreement. The parties agree to
      mediate any matter within 30 days of a demand by either party with a mediator
      mutually agreed upon
      by
      both parties. Any controversy, claim or dispute that cannot be so resolved
      shall
      be settled by final, binding arbitration in accordance with the rules of the
      American Arbitration Association
      (“AAA”). If the parties are able to agree to a single arbitrator, the matter
      need not be
      filed
      with the AAA; however, the AAA rules governing employment disputes will still
      be
applied.
      Judgment upon the award rendered by the arbitrator or arbitrators may be entered
      in any court having jurisdiction thereof. Any such arbitration shall be
      conducted in Los Angeles County or
      Ventura County, California, or such other place as may be mutually agreed upon
      by the parties.
      Each party shall bear its own costs and expenses and an equal share of the
      arbitrator's expenses and administrative fees of arbitration during the
pendency
      of
      the
      proceeding. However, the prevailing party shall be entitled to an award of
      her
      or its fees and costs at the termination of the arbitration.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    13.2 Notices.
      All
      notices, requests and other communications (collectively, “Notices”)
      given
      pursuant to this Agreement shall be in writing, and shall be delivered by fax,
      email, personal service, reputable overnight carrier or by United States first
      class, registered or certified mail (return receipt requested), postage prepaid,
      addressed to the party at the address set forth below:

     

    
      	 	
              (i)

            	
              If
                to Company:

               

              
                New
                  Motion, Inc.

                42
                  Corporate Park, 2nd Floor Irvine, CA 92606

                Attn:
                  Board of Directors Fax:
                  949-777-3707

              

            

    

     

    
      	 	
              (ii)

            	
              If
                to Executive, at the address, fax or email maintained for Executive
                in the
                Company's payroll records.

            

    

     

    Any
      Notice shall be deemed duly given when received by the addressee thereof,
      provided that any Notice sent by registered or certified mail shall be deemed
      to
      have been duly given three days from date of deposit in the United States mails,
      unless sooner received. Either party may from time to time change its address
      for further Notices hereunder by giving Notice to the other party in the manner
      prescribed in this section.

     

    13.3 Entire
      Agreement.
      This Agreement, together with the Stock Purchase Agreement, and any
      indemnification agreement contains the sole and entire agreement and
      understanding of the parties with respect to the entire subject matter of this
      Agreement, and any and all prior agreements, discussions, negotiations,
      commitments and understandings, whether oral or otherwise, related to the
      subject matter of this Agreement are hereby merged herein. No representations,
      oral or otherwise, express or implied, other than those contained in this
      Agreement have been relied upon by any party to this Agreement.

     

    13.4 Governing
      Law.
      THIS AGREEMENT SHALL BE GOVERNED BY AND
      CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA,
      WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

     

    13.5 Indemnification;
      Insurance.
      The
      Company shall defend, indemnify and hold
      Executive harmless from any and all liabilities, obligations, claims or expenses
      which arise in
      connection with or as a result of Executive's service as an officer or director
      of the Company to
      the
      greatest extent now provided in the Company's Certificate of Incorporation
      and
      Bylaws and as otherwise allowed
      by law. During the Term and for a period of at least six years thereafter,
      Executive shall be
      entitled to the same directors and officers' liability insurance coverage that
      the Company provides
      generally to its other directors and officers, as may be amended from time
      to
      time for such
      directors and officers.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    13.6 Amendment.
      The
      terms
      of this Agreement may not be amended or modified
      other than by a written instrument executed by the parties hereto or their
      respective successors.

     

    13.7 Waiver.
      Failure
      by any party hereto to insist upon strict compliance with any
      provision of this Agreement or to assert any right such party may have hereunder
      shall not be
      deemed
      to be a waiver of such provision or right or any other provision or right of
      this Agreement.

     

    13.8 Assignment.
      This
      Agreement is binding on and for the benefit of the parties
      hereto and their respective successors, heirs, executors, administrators and
      other legal representatives.

     

    13.9 Captions.
      The
      various captions of this Agreement are for reference only and
      shall
      not be considered or referred to in resolving questions of interpretation of
      this Agreement.

     

    13.10 Counterparts.
      This
      Agreement may be executed in any number of counterparts,
      each of which shall be deemed to be an original, but all of which together
      shall
      constitute one and the same instrument.

     

    13.11 Business
      Day.
      If the
      last day permissible for delivery of any Notice under any
      provision of this Agreement, or for the performance of any obligation under
      this
      Agreement, shall
      be
      other than a business day, such last day for such Notice or performance shall
      be
extended
      to the next following business day (provided, however, under no circumstances
      shall this
      provision be construed to extend the date of termination of this
      Agreement).

     

     

    (Remainder
      of page intentionally left blank.)

     

     

    Signature
      page to follow

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date first
      set forth above.

     

    
      	 	 	 
	
              Company:

               

              New
                Motion, Inc. 

            	
            
	 
 	 
 	 
 
	
              By:
                

               

              /s/
                Burton Katz

            	      	
              Executive

               

              /s/ Susan Swenson

            
	
              
Burton
              Katz, CEO	
              
Susan
              SwensonEX-4.3

 

Exhibit 4.3

Terms and Conditions

For Options granted to

Senior & Executive Management

of ASML Holding N.V. Group Companies

in Asia, EMEA and USA

under the ASML Stock Option Plan

(Version October 2007-

Stock Options from Base Salary 2007)

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	Related documentation
	 	 	3	 
	Article 1 – Definitions
	 	 	3	 
	Article 2 – Scope and Object
	 	 	6	 
	Article 3 – Allocation of Options
	 	 	6	 
	Article 4 – Acceptance of the Options
	 	 	7	 
	Article 5 – Option Period
	 	 	7	 
	Article 6 – Exercise Price
	 	 	8	 
	Article 7 – Transferability of the Option
	 	 	8	 
	Article 8 – Exercise of the Option
	 	 	8	 
	Article 9 – Dilution of Capital
	 	 	10	 
	Article 10 – Taxes and Costs 
	 	 	10	 
	Article 11 – Prevention of Inside Trading
	 	 	11	 
	Article 12 – Notices
	 	 	11	 
	Article 13 – Disputes
	 	 	11	 
	Article 14 – Amendments
	 	 	11	 

Related documents

In these option conditions reference is made to the following documents:

-   ASML Stock Option Plan (version 2)

-   ASML Rules of Conduct concerning Insider Information

These documents may be consulted on the ASML Intranet.

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

 2 of 11

 

Article 1 — Definitions

In these Option Conditions and the agreements arising from and relating thereto the following terms
shall have the meanings as defined in this Article, unless explicitly stated otherwise.

	 	 	 	 	 
	Allocation Date

	 	:
	 	the date of allocation of an Option, being two days after the publication of the annual results for
the third quarter 2007 being 19 October 2007;
	 
	 	 	 	 
	Application Form

	 	:
	 	the application form for the Plan for Senior & Executive Management (Salary Grades 92 through 95) of
ASML Group Companies in Asia, EMEA and USA, on the basis of which Options are allocated to Employees;
	 
	 	 	 	 
	ASML

	 	:
	 	ASML Holding N.V., having its registered seat at De Run 6501, 5504 DR Veldhoven, The Netherlands,
registered with the Chamber of Commerce (Kamer van Koophandel) of Oost-Brabant under registration
number 17085815;
	 
	 	 	 	 
	Embargo Period

	 	:
	 	the period from 19 October 2007 up to and including 18 October 2008;
	 
	 	 	 	 
	Employee

	 	:
	 	a natural person who on the Allocation Date is employed with an ASML Group Company in a position with
a salary grade 81 through 91, and who is on its payroll or who has been assigned abroad as an
expatriate or ITA by an ASML Group Company;
	 
	 	 	 	 
	Employer

	 	:
	 	ASML or Group Company that employs Employee on the Allocation Date;
	 
	 	 	 	 
	Exercise Price

	 	:
	 	the price for which Option Holder may acquire one Share upon the exercise of one Option;
	 
	 	 	 	 
	Exchange Value

	 	:
	 	the underlying value of one Option determined on the basis of calculation method used by ASML in
line with the applicable International Financial Reporting Standards and US GAAP accounting rules for
share based remuneration provided to employees;

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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	Group Company

	 	:
	 	an affiliated company of ASML, in which the affiliation is determined by section 24c of Book 2 of the
Dutch Civil Code, irrespective of the jurisdiction of such company and
irrespective of the place where it has its registered
office;
	 
	 	 	 	 
	Option

	 	:
	 	a right granted by Employer to Option Holder to acquire one Share against payment of the Exercise
Price during the Option Period;
	 
	 	 	 	 
	Option Agent

	 	:
	 	the organization to be designated by ASML charged with the implementation of the Option Conditions;
	 
	 	 	 	 
	Option Conditions

	 	:
	 	the present terms and conditions for Options granted to Employees of an ASML Group Company under the
ASML Stock Option Plan (version 2), including any modifications subsequently introduced herein in
conformity with the same;
	 
	 	 	 	 
	Option Holder

	 	:
	 	the holder of an Option, being the person to whom an Option has been allocated in writing and who at
the time of allocating of such Option is an Employee of ASML or who has become the holder of such
Option by virtue of being Employee’s heir;
	 
	 	 	 	 
	Option Period

	 	:
	 	the period during which the Option may be exercised;
	 
	 	 	 	 
	Option Rules

	 	:
	 	the ASML Stock Option Plan (version 2) including any modifications subsequently introduced therein
in conformity with the same, on which these Option Conditions are based;
	 
	 	 	 	 
	Plan

	 	:
	 	the Stock Options from Base Salary 2007 Plan for Senior and Executive Management (Salary Grades 92
through 95) of ASML Group Companies in Asia, EMEA (excluding The Netherlands) and USA, including the
appropriate Application Form and Option Conditions;
	 
	 	 	 	 
	Retirement

	 	:
	 	Retirement for these Option Conditions is defined
as (a) leaving the employment of Employer at the age of 55
(fifty five) years or later in case Employee is eligible to
(early) retirement payments paid by a State, Federal or
private pension fund, or (b) leaving the employment of

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

 4 of 11

 

	 	 	 	 	 
	 

	 	 	 	Employer under the “Rule of 65” without being eligible to
(early) retirement payments paid by a State, Federal or
private pension fund.
	 
	 	 	 	 
	 

	 	 	 	The “Rule of 65” determines that Employee is deemed to
retire for these Option Conditions in case Employee leaves
the employment of Employer at the age of 55 (fifty five)
years after 10 (ten) years of continued employment with
ASML, a Group Company or its legal predecessors. For every
additional year in excess of 55 (fifty five) years of age,
Employee is required to have one year less of continued
employment, until the age of 65 (sixty five) years. Employee
is deemed to retire for these Option Conditions in case
Employee leaves the employment of Employer at the age of 65
(sixty five) years with one or less years of continued
employment with ASML, a Group Company or her legal
predecessors;
	 
	 	 	 	 
	Share

	 	:
	 	an ordinary share in the capital of ASML,
having a nominal value of EUR 0.09 (nine
eurocents) or any other nominal value such
Share may have in the future; and
	 
	 	 	 	 
	Termination for Cause

	 	:
	 	Cause shall mean (i) any act of personal
dishonesty taken by Employee in connection
with his or her responsibilities as
Employee and intended to result in a
personal enrichment of Employee, (ii)
conviction of a felony, (iii) a willful act
by Employee that constitutes gross
misconduct and is injurious to Employer,
and (iv) continued violations by Employee
of his or her obligations to Employer which
are demonstrably willful and deliberate on
his or her part after (a) there has been
delivered to Employee a written demand for
performance from Employer that describes
the basis for the belief that he or she has
not substantially performed his or her
duties set forth in specific goals to cure
such defaults, and (b) he or she has been
given 30 (thirty) days during which he or
she has been unable to cure such failure to
perform his or her duties. For Employees
who are resident and/or working in the
Netherlands, the term Cause shall have the
meaning as stated in section 7:677 in
conjunction with section 7:678 of the Dutch
Civil Code at that time.

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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The terms defined above in the singular or in the plural shall also comprise the plural and vice
versa, unless in the case in concerned it can be inferred otherwise from the text of the Option
Conditions.

Article 2 – Scope and Object

These Option Conditions are part of the Option Rules and contain the terms and conditions that are
applicable to Option Holder pursuant to article IV of the Option Rules.

Option Holder is aware of the fact that the value of the shares may rise or fall, and that ASML
does not guarantee that Option Holder will derive any benefit from participating in the Plan.

Nothing in these Option Conditions or related documents by themselves or in combination shall be
construed as an expressed or implied contract of employment or a guarantee of continued future
employment.

Article 3 – Allocation of Options

	3.1	 	Options shall be allocated at the written request of Employee. The total number of Options
allocated to Employee shall be determined by ASML on the basis of the whole percentage up to
and including 8% (eight percent) of his annual gross base salary on
1 January 2007 converted into Euro for which Employee enrolled on the Application Form
divided by the Exchange Value in Euro on the Allocation Date, where a possible pro-ration
shall be applied resulting from the maximum available Options for the Plan. Annual gross
base salary for the purposes of this Plan shall equal twelve times monthly gross base
salary;
	 
	3.2	 	The number of Options to be allocated is dependent on the requested percentage of gross base
salary as mentioned on the Application Form multiplied by Employee’s gross base salary in Euro
on 1 January 2007 and divided by the Exchange Value in Euro on the Allocation Date, where a
fraction will be rounded down to the nearest whole number;
	 
	3.3	 	When submitting a request for the allocation of Options Employee shall owe Employer a net
amount in Euro converted on the Allocation Date into local currency applicable to Employee
equal to the Exchange Value on the Allocation Date multiplied by the number of Options
allocated on the Allocation Date;
	 
	3.4	 	Per Option granted, Employee shall pay to ASML the Exchange Value for one Option as
determined on the Allocation Date in Euro converted on the Allocation Date to local currency
applicable to Employee, deductible from net pay to Employee during the period October 2007
through March 2008;

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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	3.5	 	In the event of termination of employment prior to 31 March 2008, Employee, by submitting the
Application Form, authorizes ASML to deduct any balance remaining from the amount determined
in Article 3.4 from any final payroll payment. In the event that such amount is insufficient
to cover the remaining balance, Employee shall pay within one month after final payroll any outstanding balance by a check to ASML drawn on a
bank designated by ASML;

	 
	3.6	 	To be eligible for Options a fully completed and signed Application Form must have been duly
received by the Stock Option/Salary Administration in Veldhoven, The Netherlands;
	 
	3.7	 	Options shall be allocated on the basis of the Application Form taking into account the
maximum number of Options available.
	 
	3.8	 	All Euro denominated amounts mentioned in this Article shall be calculated by using the Euro
– local currency exchange rate fixing applicable to Employee on the Allocation Date as
performed by the European Central Bank at or around 14.00 hours C.E.T.

Article 4 – Acceptance of the Options

	4.1	 	By submitting the Application Form on which the wish is expressed to participate in the
underlying plan, Employee accepts (i) all of the Options that may be allocated, and (ii) the
Option Rules and the Option Conditions;
	 
	4.2	 	Employee shall be informed within a reasonable term in writing of the number of Options
allocated;
	 
	4.3	 	Effective from the Allocation Date an option agreement will come into existence.

Article 5 – Option Period

	5.1	 	The Option Period shall be 10 (ten) years, counting from the Allocation Date and shall thus
end on 19 October 2017;
	 
	5.2	 	Options may only be exercised within the Option Period after the Embargo Period has ended as
determined in Article 8 of these Option Conditions;
	 
	5.3	 	Options that have not been exercised within the Option Period shall lapse after the
expiration of the Option Period and become null and void;

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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	5.4	 	Notwithstanding the provisions of Sections 1 through 3 of this Article, the Option Period may
be extended under the circumstances as referred to in Section 6 of Article 8 of these Option
Conditions by a maximum period of 12 (twelve) months.

Article 6 – Exercise Price

The Exercise Price shall be equal to the closing price “cum dividend” of an ordinary ASML share on
NYSE Euronext Stock Exchange, Amsterdam (“AEX”) in the Netherlands on the Allocation Date. For
United States residents (other than through being assigned to the United States as an Employee) or
citizens, the Euro denominated Exercise Price will be converted into a United States Dollar
Exercise Price by taking the Exercise Price defined in the first sentence of this Article and
applying the Euro – United States Dollar exchange rate fixing on the Allocation Date as performed
by the European Central Bank at or around 14.00 hours C.E.T.

Article 7 – Transferability of the Option

	7.1	 	The Option shall be strictly non-transferable and may not be encumbered with a pledge;
	 
	7.2	 	Devolution by last will or hereditary succession pursuant to the statutory provisions shall,
however, not vitiate the Option;
	 
	7.3	 	Option Holder shall not be permitted to conclude any transaction in relation to the Options
on NYSE Euronext Stock Exchange, Amsterdam, the Netherlands, NASDAQ Global Select Market, New
York, United States of America, or any other stock exchange;
	 
	7.4	 	In the event of an Option Holder acting in contravention of the provisions of this Article,
the Options of such Option Holder shall lapse;

Article 8 – Exercise of the Option

	8.1	 	All Options allocated to Option Holder will become exercisable after the Embargo Period ends.
	 
	8.2	 	By means of a written request by Option Holder to Employer, Option Holder may exercise all or
part of the Options, provided approval of such request to exercise is given by Employer and
exercise is not in conflict with other provisions of this Article;
	 
	8.3	 	A written request to exercise Options during the Embargo Period shall not be honoured by
Employer;

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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	8.4	 	When exercising the Options Option Holder must comply with the “ASML Rules of Conduct
concerning Insider Information”, as in force at the time of exercising;

	8.5	 	In case of termination of the employment relationship between Employee and Employer due to
Employee’s (i) death, or (ii) incapability to act, the Options may be exercised during the
entire Option Period, after the Embargo Period has expired. In case the remaining Option
Period, measured from the moment of termination for aforementioned reasons, consists of less
than 12 (twelve) months, the Option Period will be extended such that the remaining Option
Period will be at least 12 (twelve) months counting from the date of the termination.
Therefore, if the date of termination for reasons mentioned in the first sentence of this
Article, falls within 12 (twelve) months before the end of the Option Period as defined in
Section 1 of Article 5 the Option Period will effectively be prolonged beyond the period as
defined in Section 1 of Article 5;

	8.6	 	In case of termination of the employment relationship between Employee and Employer due to
Employee’s (i) Retirement, including early retirement (SVM and SUM) or (ii) occupational
disability (within the meaning of the Dutch Act on Work and Income relative to Ability to
Work [Wet Werk en Inkomen naar Arbeidsvermogen]), the Options may be exercised during the
entire Option Period, after the Embargo Period has expired;

	8.7	 	If, during the Option Period, Employee is terminated for Cause by Employer or Employee is
terminated by Employer on account of another reason imputable to Employee, regardless of
whether employment has been terminated, any Options not yet exercised shall lapse forthwith.
All Options that have thus become null and void will do so without Employee being entitled to
any compensation in this respect from Employer or another Group Company;

	8.8	 	In case of termination of the employment relationship, during or after the Embargo Period,
between Employee and Employer for reasons other than those mentioned in Sections 5, 6 and 7 of
Article 8, the Options may be exercised during the Option Period, provided such exercise is
not in conflict with the provisions of Sections 1 through 4, and Section 9 of this Article. If
the Options are not exercised within the Option Period, the Options shall lapse. All Options
that have thus become null and void will do so without Employee being entitled to any
compensation in this respect from Employer or another Group Company;

	8.9	 	The Options may be exercised by Option Holder for the total number allocated or in tranches
of 100 or multiples thereof (with the exception of the last tranche), with the provision that
each exercise must take place within the Option Period, provided such exercise is not in
conflict with the provisions of Article 11 of these Option Conditions;

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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	8.10	 	Exercise of the Option shall take place in conformity with the applicable “Procedure for the
exercise of ASML Options”.

Article 9 – Dilution of Capital

	9.1	 	If at any time the issued capital of ASML increases, for instance as a result of (i) a
resolution to issue shares with a pre-emption right for the holders of the Shares at that time
outstanding, (ii) a stock dividend or (iii) a capitalisation of reserves, the Exercise Price
and/or the number of Options allocated may be adjusted in such a manner as the Board of
Management of ASML shall then decide;

	9.2	 	The adjustments by the Board of Management referred to in Article 9.1 shall be binding after
an independent accountant who is a member of the Netherlands Institute for Registered
Accountants [Nederlands Instituut voor Register Accountants] has issued a certificate stating
that the adjustments have been determined in a reasonable manner. Adjustment of the Exercise
Price and/or the number of Options shall take place on the day preceding the day on which
notice was given of the aforementioned resolutions. Possible consequences of such adjustments
for the levy of tax, social security premiums, social insurance premiums, medical insurance
premiums and income level dependent regulations, shall be entirely for the account of Option
Holder.

	9.3	 	An adjustment of the Exercise Price and/or the number of Options allocated and the
computation upon which the same are based shall be notified as soon as possible to Option
Holder in writing.

Article 10 – Taxes and Costs

	10.1	 	All taxes levied and social security premiums, social insurance and premiums medical
insurance due as a result of the allocation and/or possession and/or exercise of Options by
Option Holder, including possible consequences of an amendment of the Option Conditions, shall
be entirely for the account of Option Holder;

	10.2	 	All possible consequences for pension, including early retirement, and/or social security
and/or social insurance benefits and/or income level dependent regulations as a result of the
waiver of specific remuneration elements and of Options allocated under this plan, including
possible consequences of an amendment of the Option Conditions, shall be entirely for the
account of Option Holder;

	10.3	 	Option Holder shall be liable for all the costs relating to the exercise of Options,
including — but not limited to — costs charged by stock brokers in connection with the
acquired Shares resulting from the exercise of Options and the contiguous sale of such Shares;

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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	10.4	 	Costs relating to the issue and/or acquisition of Shares in the capital of ASML shall be for
the account of ASML.

Article 11 – Prevention of Insider Trading

Option Holder who by returning the Application Form accepts the Option Conditions, shall at the
same time, be deemed to accept the applicable “ASML Rules of Conduct concerning Insider
Information” and to act accordingly.

Article 12 — Notices

	12.1	 	Notices which must be given by ASML to Option Holder pursuant to or in connection with the
Option Rules and/or the Option Conditions shall be regarded as correctly addressed if sent to
the address of Option Holder as recorded in the Staff Records Department of ASML or the Group
Company;

	12.2	 	Notices which must be given by Option Holder to ASML pursuant to or in connection with the
Option Rules and/or the Option Conditions shall be regarded as correctly addressed if sent to
the address of ASML as listed with the Chamber of Commerce, for the attention of the ASML
Option Administrator.

Article 13 — Disputes

	13.1	 	The Option Rules, the Option Conditions, the annexes thereto, and all further documents
related to the Option Rules and/or the Option Conditions shall be governed by the laws of the
Netherlands;

	13.2	 	All disputes arising from the Option Rules, the Option Conditions, the annexes thereto, and
further documents related to the Option Rules and/or the Option Conditions, shall in the first
instance, be settled by the District Court of ‘s-Hertogenbosch;

Article 14 — Amendments

	14.1	 	The Board of Management shall have the power to amend the Option Rules and/or Option
Conditions or add further provisions to the same at any time;

	14.2	 	Option Holder shall be informed of any amendments or measures as referred to in this Article
in good time, in writing.

TERMS AND CONDITIONS FOR OPTIONS GRANTED TO SENIOR AND EXECUTIVE MANAGEMENT OF ASML HOLDING N.V.
GROUP COMPANIES IN ASIA, EMEA AND USA UNDER THE ASML STOCK OPTION PLAN (Version October 2007 –
Stock Options from Base Salary 2007 Plan )

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