Sample Business Contracts


Conditional Stock Award Agreement - Ask Jeeves Inc. and Steven J. Sordello


                                ASK JEEVES, INC.
                           1999 EQUITY INCENTIVE PLAN
                        CONDITIONAL STOCK AWARD AGREEMENT

        THIS CONDITIONAL STOCK AWARD AGREEMENT (this "Agreement") is dated as of
the 30th day of September 2003, by and between ASK JEEVES, INC., a Delaware
corporation (the "Company") and Steven J. Sordello (the "Executive").

                                    RECITALS

        The Company maintains the Ask Jeeves, Inc. 1999 Equity Incentive Plan,
as amended (the "Plan").

        The Company hereby grants to the Executive, effective as of the date
first set forth above (the "Award Date"), a conditional right to be granted
shares of Common Stock of the Company (the "Award"), upon the terms and
conditions set forth herein and in the Plan.

                                    AGREEMENT

        In consideration of the mutual promises made herein and the mutual
benefits to be derived therefrom, the parties agree as follows:

        1. DEFINED TERMS. Capitalized terms used in this Agreement and not
otherwise defined herein shall have the meanings given to such terms in the
Plan. For purposes of this Agreement, the term "Change in Control" shall have
the meaning given to that term in that certain letter agreement regarding
potential severance benefits, dated November 14, 2002, by and between the
Executive and the Company (the "Severance Benefit Agreement"). For purposes of
this Agreement, the terms "Disability," "Termination for Cause," and
"Involuntary Termination" shall also have the respective meanings given to such
terms in the Severance Benefit Agreement. For purposes of this Agreement, the
term "Affiliate" means any "Corporate Affiliate" as that term is defined in the
Severance Benefit Agreement.

        2. GRANT. Subject to the terms of this Agreement, the Company hereby
grants to the Executive an Award of seventy thousand (70,000) stock units
("Units"), subject to reduction as provided in Section 3 below and further
subject to adjustment as provided in Section 11(a) of the Plan.

        3.     REDUCTION IN THE NUMBER OF UNITS.

        (a) Quarterly Reduction. On the last calendar day in September 2003 and
on the last calendar day of each third month thereafter and continuing until the
remaining number of Units subject to the Award is zero (0) or the then-remaining
Units subject to the Award become payable pursuant to Section 4, the total
number of Units subject to the Award shall be reduced (from the amount set forth
in Section 2 above and after giving effect to prior reductions to such number
pursuant to the reduction provisions of this Agreement) by five thousand (5,000)
Units (subject to adjustment in accordance with Section 11(a) of the Plan) on
each such date (such that the total number Units subject to the Award is
scheduled to become zero (0) on March 31, 2007 assuming that payment of the
then-remaining Units is not triggered pursuant to Section 4 prior to


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that date). The Units subject to the Award are subject to accelerated reduction
pursuant to Section 3(b) below and pursuant to Section 3(c) below. The Award
shall terminate, without any payment in respect of such termination, if and when
no Units remain subject to the Award.

        (b) Termination Prior to Change in Control. If the Executive ceases to
be employed by the Company or one of its Affiliates (regardless of the reason
for such termination of employment, whether with or without cause, voluntarily
or involuntarily, or due to death or Disability) prior to the occurrence of a
Change in Control of the Company, the total number of Units then remaining
subject to the Award shall automatically be reduced to zero (0) immediately upon
such termination of employment and the Award shall thereupon terminate without
any payment with respect thereto or in respect thereof.

        (c) Certain Terminations Following Change in Control. If the Executive
ceases to be employed by the Company or one of its Affiliates upon or following
a Change in Control of the Company, and if such termination of employment is
either a Termination for Cause by the Company, a termination due to the
Executive's death or Disability, or a termination by the Executive other than an
Involuntary Termination, then the total number of Units then remaining subject
to the Award shall automatically be reduced to zero (0) immediately upon such
termination of employment and the Award shall thereupon terminate without any
payment with respect thereto or in respect thereof.

        (d) No Rights With Respect to Units Reduced. The Executive shall have no
payment or rights under or with respect to this Award with respect to any Units
originally subject to this Award that are reduced from the remaining total
number of Units subject to this Award pursuant to the foregoing provisions of
this Section 3.

        (e) Special Employment Rule. For purposes of this Agreement (including
this Section 3 and Section 4 below), the Executive's employment shall be deemed
to have not terminated if the Executive's employment by the Company or one of
its Affiliates terminates but immediately thereafter the Executive continues to
be employed by the Company or another of its Affiliates, as applicable. However,
if the Executive is employed only by an Affiliate and that entity ceases to be
an Affiliate, then the Executive's employment shall be deemed to have terminated
for purposes of this Agreement unless the Executive otherwise continues as an
employee of the Company or another Affiliate immediately following such event.

        4. PAYMENT OF REMAINING UNITS SUBJECT TO AWARD. Subject to the other
terms of this Agreement (including, without limitation, Section 10 below), the
then-remaining number of Units subject to this Award (after giving effect to any
and all reductions required through such date pursuant to Section 3) shall
become payable upon the first date (if any) that both of the following
requirements are satisfied:

        (a)  a Change in Control of the Company has occurred; and

        (b)  upon or following such a Change in Control of the Company, the
             Executive ceases to be employed by the Company or one of its
             Affiliates and such termination of employment is due to either (i)
             a termination by the Company for any reason other than a
             Termination for Cause (and other than due to the Executive's death


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<PAGE>
             or Disability), or (iii) an Involuntary Termination by the
             Executive (and other than due to the Executive's death or
             Disability).

The Executive shall not be entitled to any benefits with respect to the Award or
this Agreement if either (i) a Change in Control of the Company does not occur
on or before March 31, 2007, or (ii) a Change in Control of the Company does
occur on or before March 31, 2007 but the requirements of clause (b) above are
not satisfied on or before March 31, 2007.

        The number of Units that become payable to the Executive pursuant to the
foregoing paragraph shall be paid by the Company to the Executive in the form of
an equal number of shares of Common Stock of the Company.

        5. NO EMPLOYMENT OR OTHER SERVICE RIGHTS. Nothing contained in this
Agreement or the Plan constitutes an employment or service commitment by the
Company or any of its affiliates, affects the Executive's status as an employee
at will who is subject to termination without cause, confers upon the Executive
any right to remain employed by the Company or any of its affiliates, interferes
in any way with the right of the Company or any of its affiliates at any time to
terminate such employment, or affects the right of the Company or any of its
affiliates to increase or decrease the Executive's other compensation or
benefits. Nothing in this paragraph, however, is intended to adversely affect
any independent contractual right of the Executive without his or her consent
thereto. Employment for any period of time (including a substantial period of
time) after the Award Date will not entitle the Executive to any proportionate
vesting or avoid or mitigate a termination of rights and benefits upon or
following a termination of employment as provided in Section 3 or 4 above if the
express conditions to vesting set forth in such sections have not been
satisfied.

        6. NO STOCKHOLDER RIGHTS. The Units are used solely as a device for
determining the number of shares of Common Stock to be distributed to the
Executive if and when the Units become payable pursuant to this Agreement. The
Units shall not be treated as property or as a trust fund of any kind. This
Agreement creates no fiduciary duty to the Executive and shall create only a
contractual obligation on the part of the Company to issue shares of Common
Stock equal to the number of Units that become payable in accordance with the
terms of this Agreement. The Executive shall have no rights as a stockholder of
the Company (including, without limitation, dividend and voting rights) with
respect to any Units subject to the Award unless and until the remaining Units
subject to the Award become payable to the Executive pursuant to Section 4. As
to any shares of Common Stock subject to the Award that become payable pursuant
to Section 4, the Executive shall be entitled to cash dividend, voting and other
stockholder rights with respect to such shares only to the extent that the
related record date for such event is after the date that the shares have
actually been issued in the name of the Executive pursuant to Section 8.

        7. RESTRICTIONS ON TRANSFER. Neither the Award, any Units, nor, at any
time prior to the time that they have actually been issued in the name of the
Executive pursuant to Section 8 with respect to the Units, any shares underlying
or issuable in respect of the Award, nor any interest therein or amount payable
in respect thereof, may be sold, assigned, transferred, pledged or otherwise
disposed of, alienated or encumbered, either voluntarily or involuntarily. The
transfer restrictions in the preceding sentence shall not apply to transfers to
the Company.


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<PAGE>
        8. STOCK CERTIFICATES. Any shares of Common Stock that become
deliverable to the Executive pursuant to Section 4 shall, in the Company's
discretion, be issued either: (1) in certificate form in the name of the
Executive; or (2) in book entry form in the name of the Executive. Such issuance
of a share certificate or book entry shall be completed by the Company promptly
following the date that such shares become deliverable pursuant to Section 4.

        9. ADJUSTMENTS UPON SPECIFIED EVENTS. Upon the occurrence of certain
events relating to the Company's stock contemplated by Section 11(a) of the
Plan, the Board will make adjustments if appropriate in the number of Units and
the number and kind of securities that may become deliverable under the Award.

        10.    LIMITATION ON BENEFITS.

        (a) Benefit Limit. The provisions of this Section 10 shall control in
the event any conflict occurs between this Section 10 and the other provisions
of this Agreement regarding the vesting, issuance or delivery of any shares of
Common Stock subject to this Agreement. If any payment of shares subject to this
Award would constitute a "parachute payment" within the meaning of Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended (the "Code"), and
the Treasury Regulations issued thereunder, then in no event shall the aggregate
payment(s) or distribution(s) of any type to or for the Executive by the Company
or any of its affiliates, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise
(collectively, the "Total Payments") is or will be subject to the excise tax
imposed under Section 4999 of the Code, then the Total Payments shall be reduced
(but not below zero) so that the maximum amount of the Total Payments (after
reduction) shall be one dollar ($1.00) less than the amount which would cause
the Total Payments to be subject to the excise tax imposed by Section 4999 of
the Code; provided that such reduction to the Total Payments shall be made only
if the total after-tax benefit to the Executive is greater after giving effect
to such reduction than if no such reduction had been made. Unless the Executive
shall have given prior written notice to the Company to effectuate a reduction
in the Total Payments if such a reduction is required, the Company shall reduce
or eliminate the Total Payments by first reducing or eliminating any cash
severance benefits, then by reducing or eliminating any accelerated vesting of
stock options, then by reducing or eliminating any vesting of restricted stock,
then by reducing or eliminating any other remaining Total Payments. The
preceding provisions of this Section 10 shall take precedence over the
provisions of any other plan, arrangement or agreement governing the Executive's
rights and entitlements to any benefits or compensation.

        (b) Resolution Procedure. In the event there is any dispute between the
Executive and the Company as to whether any benefits to which the Executive
becomes entitled under this Agreement constitute parachute payments, such
dispute shall be resolved as follows:

               (i) In the event temporary, proposed or final Treasury
        Regulations in effect at the time under Code Section 280G (or applicable
        judicial decisions) specifically address the status of any such benefit
        or the method of valuation therefore, the characterization afforded to
        such benefit by the Regulations (or such decisions) shall, together with
        the applicable valuation methodology, be controlling.

               (ii) In the event Treasury Regulations (or applicable judicial
        decisions) do not


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        address the status of any benefit in dispute, the matter will be
        submitted for resolution to independent counsel mutually acceptable to
        the Executive and the Company ("Independent Counsel"). The resolution
        reached by Independent Counsel will be final and controlling; provided,
        however, that if in the judgment of Independent Counsel the status of
        the benefit in dispute can be resolved through the obtainment of a
        private letter ruling from the Internal Revenue Service, a formal and
        proper request for such ruling will be prepared and submitted by
        Independent Counsel, and the determination made by the Internal Revenue
        Service in the issued ruling will be controlling. All expenses incurred
        in connection with the retention of Independent Counsel and (if
        applicable) the preparation and submission of the ruling request shall
        be shared equally by the Executive and the Company.

               (iii) In the event Treasury Regulations (or applicable judicial
        decisions) do not address the appropriate valuation methodology for any
        benefit in dispute, the value thereof will, at the Independent Counsel's
        election, be determined through an independent third-party appraisal,
        and the expenses incurred in obtaining such appraisal shall be shared
        equally by the Executive and the Company.

        (c) Status of Benefits. No benefits will be made available to the
Executive under this Agreement until the value of such benefits has been
determined and the status of any benefits in dispute under Section 10(b) above
has been resolved in accordance therewith.

        11. TAX WITHHOLDING. The Company shall reasonably determine the amount
of any federal, state, local or other income, employment, or other taxes which
the Company or any of its affiliates may reasonably be obligated to withhold
with respect to the grant, payment, or other event with respect to this Award.
The Company may, in its sole discretion, withhold a sufficient number of shares
of Common Stock otherwise deliverable pursuant to this Award at their then fair
market value (determined either as of the date of such withholding or as of the
immediately preceding trading day, as determined by the Company in its
discretion) to satisfy the amount of any such withholding obligations that arise
with respect to the payment of this Award. The Company may take such action(s)
without notice to the Executive and shall remit to the Executive the balance of
any proceeds from withholding such shares in excess of the amount reasonably
determined to be necessary to satisfy such withholding obligations. The
Executive shall have no discretion as to the Company's satisfaction of tax
withholding obligations in such manner. If, however, the Company for any reason
does not satisfy the withholding obligations with respect to this Award as
provided above in this Section 11, the Company (or any affiliate of the Company
that employs the Executive, as applicable) shall be entitled to require a cash
payment by or on behalf of the Executive and/or to deduct from other
compensation payable to the Executive the amount of any such withholding
obligations.

        12. NOTICES. Any notice to be given to the Company under the terms of
this Agreement shall be in writing and addressed to the Company at its principal
office located at 5858 Horton Street, Suite 350, Emeryville, California 94608,
Attention: Corporate Secretary, and any notice to be given to the Executive
shall be addressed to him or her at the address given beneath the Executive's
signature hereto, or at such other address as either party may hereafter
designate in writing to the other party. Any notice shall be delivered in person
or shall be enclosed in a properly sealed envelope, addressed as aforesaid,
registered or certified (postage or


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<PAGE>
certification fee prepaid) in a post office or branch post office regularly
maintained by the United States Government.

        13. PLAN. The Award and all rights of the Executive with respect thereto
are subject to, and the Executive agrees to be bound by, all of the terms and
conditions of the Plan, incorporated herein by reference, to the extent such
provisions are applicable to the Award. The Executive acknowledges having
received a copy of the Plan, the Prospectus for the Plan and a related
prospectus supplement that relates to the Award under the Plan. Unless otherwise
expressly provided in other Sections of this Agreement, provisions of the Plan
that confer discretionary authority on the Administrator do not (and shall not
be deemed to) create any rights in the Executive unless such rights are
expressly set forth herein or are otherwise in the sole discretion of the
Administrator so conferred by appropriate action of the Administrator under the
Plan after the date hereof.

        14. ENTIRE AGREEMENT. This Agreement and the Plan, along with those
definitions set forth in the Severance Benefit Agreement that are specifically
referred to herein and the arbitration provisions of the Severance Benefit
Agreement specifically referred to in Section 19 below (but no other provision
of the Severance Benefit Agreement), together constitute the entire agreement
and supersede all prior understandings and agreements, written or oral, of the
parties hereto with respect to the subject matter hereof. The Plan may be
amended pursuant to Section 12 thereof. No modification or amendment of this
Agreement will take effect unless it is approved by the Administrator and is in
writing and signed by an authorized officer of the Company and, if the amendment
materially and adversely affects the Executive's rights with respect to the
Award, by the Executive. The Company may unilaterally waive any provision hereof
in writing to the extent such waiver does not materially and adversely affect
the Executive's rights with respect to the Award, provided that no such waiver
shall operate or be construed to be a subsequent waiver of the same provision or
a waiver of any other provision hereof.

        15. EFFECT OF THIS AGREEMENT. This Agreement shall be assumed by, be
binding upon and inure to the benefit of any successor or successors to the
Company. The term "Company" as used herein also may refer to any successor to
Ask Jeeves, Inc., if the context so requires.

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

        17. SECTION HEADINGS. The section headings of this Agreement are for
convenience of reference only and shall not be deemed to alter or affect any
provision hereof.

        18. GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of California without regard
to conflict of law principles thereunder.

        19. ARBITRATION. To the fullest extent allowed by law, any controversy
or claim arising out of or relating to this Award and/or the Units shall be
settled by binding and non-appealable arbitration conducted in accordance with
the arbitration provisions set forth in Section


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6 of the Severance Benefit Agreement. The parties intend that this Section 19
shall be valid, binding, enforceable and irrevocable and shall survive any
termination of this Agreement and/or the Severance Benefit Agreement. The
Executive acknowledges and agrees that the Executive is waiving the Executive's
right to a jury trial and agrees that the decision of the arbitrator shall be
final and binding.

        IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
on its behalf by a duly authorized officer and the Executive has hereunto set
his or her hand as of the date and year first above written.

                                            ASK JEEVES, INC.,
                                            A DELAWARE CORPORATION



                                            By: /s/ A. George (Skip) Battle
                                                -------------------------------

                                            Print Name: A. George (Skip) Battle
                                                        -----------------------
                                            Its: Chief Executive Officer
                                                 ------------------------------

                                            EXECUTIVE

                                            /s/ Steven J. Sordello
                                            -----------------------------------
                                            Signature

                                            Steven J. Sordello
                                            -----------------------------------
                                            Print Name


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