<PAGE>
As filed with the Securities and Exchange Commission on March 2, 2000
Registration No. 333-______
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AT HOME CORPORATION
(Exact name of the Registrant as specified in its charter)
Delaware 77-0408542
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
450 Broadway Street
Redwood City, California 94063
(Address of principal executive offices)
Options of Kendara, Inc. issued under the Kendara, Inc. 1999 Stock Plan and
Assumed by the Registrant Options of Hartford House,Ltd. issued under the
Hartford House, Ltd. 1999 Stock Option/Stock Issuance
Plan and Assumed by the Registrant
2000 Equity Incentive Plan
(Full titles of the plans)
Kenneth A. Goldman
Senior Vice President and Chief Financial Officer
At Home Corporation
425 Broadway Street
Redwood City, California 94063
(650) 569-5000
(Name, address and telephone number, including area code, of agent for service)
Copy to:
Jeffrey R. Vetter, Esq.
Tram T. Phi, Esq.
Benjamin Hadary, Esq.
Fenwick & West LLP
Two Palo Alto Square
Palo Alto, CA 94306
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------
Proposed Proposed
Amount Maximum Maximum Amount of
to be Offering Price Per Aggregate Offering Registration
Title of Securities to be Registered Registered Share Price Fee
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Series A Common Stock, 194,573 (1) $14.6081 (2) $2,842,341.841 (2) $ 750.38
$0.01 par value per share
- --------------------------------------------------------------------------------------------------------------------------------
Series A Common Stock, 541,545 (3) $ 18.59 (2) $10,067,321.55 (2) $ 2,657.77
$0.01 par value per share
- --------------------------------------------------------------------------------------------------------------------------------
Series A Common Stock, 2,000,000 (4) $ 33.4688 (5) $ 66,937,600 (5) $17,671.53
$0.01 par value per share
- --------------------------------------------------------------------------------------------------------------------------------
Total: $21,079.68
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents the number of shares subject to options assumed from Kendara,
Inc., a Delaware corporation, which was acquired by the Registrant on
February 10, 2000.
<PAGE>
(2) Represents weighted average per share exercise price for such outstanding
options, calculated pursuant to Rule 457(h)(1) of the Securities Act of
1933, as amended (the "Securities Act").
(3) Represents the number of shares subject to options issued to former holders
of options of Hartford House, Ltd., a Delaware corporation, which was
acquired by the Registrant on December 13, 1999 in connection with the
earnout provisions of that acquisition.
(4) Represents shares available for grant and issuance under the 2000 Equity
Incentive Plan.
(5) Calculated solely for purposes of this offering under Rule 457(h)(1) of the
Securities Act on the basis of the average of the high and low prices per
share of Series A Common Stock of the Registrant on February 28, 2000 as
reported by the Nasdaq National Market.
-2-
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION (1)
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION (1)
(1) Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from the Registration Statement in accordance with
Rule 428 under the Securities Act of 1933, as amended (the "Securities
Act") and the Note to Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
For the purposes of this registration statement, the terms "we," "our"
and "us" refer to At Home Corporation, a Delaware corporation.
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Commission are incorporated
into this registration statement by reference:
(a) Our annual report on Form 10-K for the fiscal year ended December
31, 1998, as amended on March 31, 1999 and on April 27, 1999.
(b) Our quarterly reports on Form 10-Q for the fiscal quarters ended
March 31, June 30 and September 30, 1999.
(c) Our current reports on Form 8-K filed on January 14, 1999, as
amended on February 19, 1999; February 19, 1999; April 8, 1999;
June 14, 1999, as amended August 13, 1999; August 2, 1999;
October 27, 1999; December 6, 1999 and December 22, 1999.
(d) The description of the Registrant's Series A common stock
contained in the Registrant's registration statement on Form 8-A
filed by the Registrant on June 13, 1997 under Section 12(g) of
the Exchange Act, including any amendment or report filed for the
purpose of updating such description.
All documents subsequently filed by us pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act of 1934, as amended (the
"Exchange Act"), prior to the filing of a post-effective amendment
which indicates that all securities registered hereby have been sold
or which deregisters all securities then remaining unsold, shall be
deemed incorporated by reference in this registration statement and to
be a part hereof from the date of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
<PAGE>
As permitted by the Delaware General Corporation Law, the Registrant's
Certificate of Incorporation includes a provision that eliminates the
personal liability of its directors to the Registrant or its
stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability:
. for any breach of the director's duty of loyalty to the corporation
or its stockholders;
. for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law;
. under Section 174 of the Delaware General Corporation Law; or
. for any transaction from which the director derived an improper
personal benefit.
As permitted by Section 145 of the Delaware General Corporation Law,
the Registrant's Certificate of Incorporation further provides:
. for mandatory indemnification, to the fullest extent permitted by
applicable law, for any person who is or was a director or officer,
or is or was serving at the request of the Registrant as a
director, officer, employee or agent of another corporation or of a
partnership, joint venture, trust, enterprise or nonprofit entity,
including service with respect to employee benefit plans, against
all liability and loss suffered and expenses (including attorneys'
fees) reasonably incurred by this person;
. that the Registrant's obligation to indemnify any person who was or
is serving at the Registrant's request as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust, enterprise or nonprofit entity must be reduced by
any amount the person may collect as indemnification from the other
corporation, partnership, joint venture, trust, enterprise or
nonprofit entity;
. that the Registrant must advance to all indemnified parties the
expenses (including attorneys' fees) incurred in defending any
proceeding provided that indemnified parties (if they are directors
or officers) must provide the Registrant an undertaking to repay
the advances if indemnification is determined to be unavailable;
. that the rights conferred in the Certificate of Incorporation are
not exclusive; and
. that the Registrant may not retroactively amend the Certification
of Incorporation provisions relating to indemnity.
The indemnification provision in the Registrant's Certificate of
Incorporation and the Indemnification Agreements entered into between
the Registrant and each of its directors and executive officers may be
sufficiently broad to permit indemnification of the Registrant's
directors and officers for liabilities arising under the Securities
Act. The Registrant has also obtained directors' and officers'
liability insurance. The following documents are incorporated by
reference:
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
-2-
<PAGE>
ITEM 8. EXHIBITS.
Exhibit Exhibit
Number Title
- ------- -------
4.01 The Registrant's Fifth Amended and Restated Certificate of
Incorporation, as filed with the Delaware Secretary of State on May
28, 1999 (incorporated by reference to Exhibit 4.01 of our
registration statement on Form S-8, filed with the Commission on
June 3, 1999 (File No. 333-79883)).
4.02 The Registrant's Second Amended and Restated Bylaws effective July
16, 1997 (incorporated by reference to Exhibit 3.05 of our
registration statement on Form S-1 declared effective by the
Commission on July 11, 1997 (File No. 333-27323)).
4.03 Kendara, Inc. 1999 Stock Plan.
4.04 Kendara, Inc. 1999 Stock Plan Notice of Stock Option Grant.
4.05 Kendara, Inc. 1999 Stock Plan Notice of Stock Option Exercise.
4.06 2000 Equity Incentive Plan.
4.07 2000 Equity Incentive Plan Notice of Stock Option Grant.
4.08 2000 Equity Incentive Plan Stock Option Grant Terms and Conditions.
4.09 2000 Equity Incentive Plan Stock Option Exercise Notice and
Agreement.
4.10 Hartford House, Ltd. 1999 Stock Option/Stock Issuance Plan
(incorporated by reference to Exhibit 4.03 of our registration
statement on Form S-8 filed with the Commission on December 22,
1999).
5.01 Opinion of Fenwick & West LLP regarding the legality of the
securities to be offered.
23.01 Consent of Ernst & Young LLP, Independent Auditors.
23.02 Consent of PricewaterhouseCoopers LLP, Independent Accountants.
23.03 Consent of Fenwick & West LLP (included in Exhibit 5.01).
24.01 Power of Attorney (see the signature page of this Registration
Statement).
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set
-3-
<PAGE>
forth in the Registration Statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered
would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more
than a 20 percent change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee"
table in the effective registration statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) above do not
-------- -------
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or furnished to
the Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
---------
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
----
fide offering thereof.
- ----
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions discussed in Item 6 hereof, or otherwise,
the Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered hereby, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
-4-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
At Home Corporation, certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in Redwood City, State of California, on this 2nd day of March,
2000.
AT HOME CORPORATION
By: /s/ George Bell
-----------------------------------------
George Bell
President and Chief Executive Officer
POWER OF ATTORNEY
Each individual whose signature appears below constitutes and appoints
George Bell, Kenneth A. Goldman and David G. Pine, and each of them, his true
and lawful attorneys-in-fact and agents, each with the power of substitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this registration
statement, and to file the same, with all exhibits thereto and all documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorneys-in-
fact and agents or any of them, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
Principal Executive Officer:
/s/ George Bell President, Chief Executive March 2, 2000
- -----------------------------
George Bell Officer and Director
Principal Financial Officer:
/s/ Kenneth A. Goldman Senior Vice President and March 2, 2000
- -----------------------------
Kenneth A. Goldman Chief Financial Officer
Principal Accounting Officer:
/s/ Robert A. Lerner Corporate Controller March 2, 2000
_____________________________
Robert A. Lerner
</TABLE>
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<PAGE>
Signature Title Date
- --------- ----- ----
Additional Directors:
/s/ Thomas A. Jermoluk Chairman March 2, 2000
_____________________________
Thomas A. Jermoluk
/s/ William R. Hearst III Director March 2, 2000
_____________________________
William R. Hearst III
Director
_____________________________
C. Michael Armstrong
Director
_____________________________
L. John Doerr
/s/ John C. Malone Director March 2, 2000
_____________________________
John C. Malone
Director
_____________________________
John C. Petrillo
/s/ Brian L. Roberts Director March 2, 2000
_____________________________
Brian L. Roberts
Director
_____________________________
Ray Liguni
/s/ David M. Woodrow Director March 2, 2000
_____________________________
David M. Woodrow
Director
_____________________________
Ted Rogers
-6-
<PAGE>
EXHIBIT INDEX
-------------
Exhibit Exhibit
Number Title
- ------- -----
4.01 The Registrant's Fifth Amended and Restated Certificate of
Incorporation, as filed with the Delaware Secretary of State on May
28, 1999 (incorporated by reference to Exhibit 4.01 of our
registration statement on Form S-8, filed with the Commission on
June 3, 1999 (File No. 333-79883)).
4.02 The Registrant's Second Amended and Restated Bylaws effective July
16, 1997 (incorporated by reference to Exhibit 3.05 of our
registration statement on Form S-1 declared effective by the
Commission on July 11, 1997 (File No. 333-27323)).
4.03 Kendara, Inc. 1999 Stock Plan.
4.04 Kendara, Inc. 1999 Stock Plan Notice of Stock Option Grant.
4.05 Kendara, Inc. 1999 Stock Plan Notice of Stock Option Exercise.
4.06 2000 Equity Incentive Plan.
4.07 2000 Equity Incentive Plan Notice of Stock Option Grant.
4.08 2000 Equity Incentive Plan Stock Option Grant Terms and Conditions.
4.09 2000 Equity Incentive Plan Stock Option Exercise Notice and
Agreement.
4.10 Hartford House, Ltd. 1999 Stock Option/Stock Issuance Plan
(incorporated by reference to Exhibit 4.03 of our registration
statement on Form S-8 filed with the Commission on December 22,
1999).
5.01 Opinion of Fenwick & West LLP regarding the legality of the
securities to be offered.
23.01 Consent of Ernst & Young LLP, Independent Auditors.
23.02 Consent of PricewaterhouseCoopers LLP, Independent Accountants.
23.03 Consent of Fenwick & West LLP (included in Exhibit 5.01).
24.01 Power of Attorney (see the signature page of this Registration
Statement).
<PAGE>
EXHIBIT 4.03
Kendara, Inc.
1999 Stock Plan
Adopted on May 21, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
SECTION 1. ESTABLISHMENT AND PURPOSE.................................... 1
SECTION 2. ADMINISTRATION............................................... 1
(a) Committees of the Board of Directors............................... 1
(b) Authority of the Board of Directors................................ 1
SECTION 3. ELIGIBILITY.................................................. 1
(a) General Rule....................................................... 1
(b) Ten-Percent Stockholders........................................... 1
SECTION 4. STOCK SUBJECT TO PLAN........................................ 2
(a) Basic Limitation................................................... 2
(b) Additional Shares.................................................. 2
SECTION 5. TERMS AND CONDITIONS OF AWARDS OR SALES...................... 2
(a) Stock Purchase Agreement........................................... 2
(b) Duration of Offers and Nontransferability of Rights................ 2
(c) Purchase Price..................................................... 3
(d) Withholding Taxes.................................................. 3
(e) Restrictions on Transfer of Shares and Minimum Vesting............. 3
(f) Accelerated Vesting................................................ 3
SECTION 6. TERMS AND CONDITIONS OF OPTIONS.............................. 3
(a) Stock Option Agreement............................................. 3
(b) Number of Shares................................................... 3
(c) Exercise Price..................................................... 4
(d) Withholding Taxes.................................................. 4
(e) Exercisability..................................................... 4
(f) Accelerated Exercisability......................................... 4
(g) Basic Term......................................................... 4
(h) Nontransferability................................................. 4
(i) Termination of Service (Except by Death)........................... 4
(j) Leaves of Absence.................................................. 5
(k) Death of Optionee.................................................. 5
(l) No Rights as a Stockholder......................................... 6
(m) Modification, Extension and Assumption of Options.................. 6
(n) Restrictions on Transfer of Shares and Minimum Vesting............. 6
(o) Accelerated Vesting................................................ 6
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
SECTION 7. PAYMENT FOR SHARES........................................... 7
(a) General Rule....................................................... 7
(b) Surrender of Stock................................................. 7
(c) Services Rendered.................................................. 7
(d) Promissory Note.................................................... 7
(e) Exercise/Sale...................................................... 7
(f) Exercise/Pledge.................................................... 7
SECTION 8. ADJUSTMENT OF SHARES......................................... 8
(a) General............................................................ 8
(b) Mergers and Consolidations......................................... 8
(c) Reservation of Rights.............................................. 8
SECTION 9. SECURITIES LAWS REQUIREMENTS................................. 8
(a) General............................................................ 8
(b) Financial Reports.................................................. 9
SECTION 10. NO RETENTION RIGHTS......................................... 9
SECTION 11. DURATION AND AMENDMENTS..................................... 9
(a) Term of the Plan................................................... 9
(b) Right to Amend or Terminate the Plan............................... 9
(c) Effect of Amendment or Termination................................. 9
SECTION 12. DEFINITIONS................................................. 10
</TABLE>
ii
<PAGE>
Kendara, Inc. 1999 Stock Plan
SECTION 1. ESTABLISHMENT AND PURPOSE.
The purpose of the Plan is to offer selected individuals an opportunity to
acquire a proprietary interest in the success of the Company, or to increase
such interest, by purchasing Shares of the Company's Stock. The Plan provides
both for the direct award or sale of Shares and for the grant of Options to
purchase Shares. Options granted under the Plan may include Nonstatutory Options
as well as ISOs intended to qualify under Section 422 of the Code.
Capitalized terms are defined in Section 12.
SECTION 2. ADMINISTRATION.
(a) Committees of the Board of Directors. The Plan may be administered by
one or more Committees. Each Committee shall consist of one or more members of
the Board of Directors who have been appointed by the Board of Directors. Each
Committee shall have such authority and be responsible for such functions as the
Board of Directors has assigned to it. If no Committee has been appointed, the
entire Board of Directors shall administer the Plan. Any reference to the Board
of Directors in the Plan shall be construed as a reference to the Committee (if
any) to whom the Board of Directors has assigned a particular function.
(b) Authority of the Board of Directors. Subject to the provisions of the
Plan, the Board of Directors shall have full authority and discretion to take
any actions it deems necessary or advisable for the administration of the Plan.
All decisions, interpretations and other actions of the Board of Directors shall
be final and binding on all Purchasers, all Optionees and all persons deriving
their rights from a Purchaser or Optionee.
SECTION 3. ELIGIBILITY.
(a) General Rule. Only Employees, Outside Directors and Consultants shall
be eligible for the grant of Options or the direct award or sale of Shares. Only
Employees shall be eligible for the grant of ISOs.
(b) Ten-Percent Stockholders. An individual who owns more than 10% of the
total combined voting power of all classes of outstanding stock of the Company,
its Parent or any of its Subsidiaries shall not be eligible for designation as
an Optionee or Purchaser unless (i) the Exercise Price is at least 110% of the
Fair Market Value of a Share on the date of grant, (ii) the Purchase Price (if
any) is at least 100% of the Fair Market Value of a Share and (iii) in the case
of an ISO, such ISO by its terms is not exercisable after the expiration of five
years from the date of grant. For purposes of this Subsection (b), in
determining stock ownership, the attribution rules of Section 424(d) of the Code
shall be applied.
<PAGE>
SECTION 4. STOCK SUBJECT TO PLAN.
(a) Basic Limitation. Shares offered under the Plan may be authorized but
unissued Shares or treasury Shares. The aggregate number of Shares that may be
issued under the Plan (upon exercise of Options or other rights to acquire
Shares) shall not exceed 3,357,142/1/ Shares, subject to adjustment pursuant to
Section 8. The number of Shares that are subject to Options or other rights
outstanding at any time under the Plan shall not exceed the number of Shares
that then remain available for issuance under the Plan. The Company, during the
term of the Plan, shall at all times reserve and keep available sufficient
Shares to satisfy the requirements of the Plan.
(b) Additional Shares. In the event that any outstanding Option or other
right for any reason expires or is canceled or otherwise terminated, the Shares
allocable to the unexercised portion of such Option or other right shall again
be available for the purposes of the Plan. In the event that Shares issued under
the Plan are reacquired by the Company pursuant to any forfeiture provision,
right of repurchase or right of first refusal, such Shares shall again be
available for the purposes of the Plan, except that the aggregate number of
Shares which may be issued upon the exercise of ISOs shall in no event exceed
3,357,142 Shares (subject to adjustment pursuant to Section 8).
SECTION 5. TERMS AND CONDITIONS OF AWARDS OR SALES.
(a) Stock Purchase Agreement. Each award or sale of Shares under the Plan
(other than upon exercise of an Option) shall be evidenced by a Stock Purchase
Agreement between the Purchaser and the Company. Such award or sale shall be
subject to all applicable terms and conditions of the Plan and may be subject to
any other terms and conditions which are not inconsistent with the Plan and
which the Board of Directors deems appropriate for inclusion in a Stock Purchase
Agreement. The provisions of the various Stock Purchase Agreements entered into
under the Plan need not be identical.
(b) Duration of Offers and Nontransferability of Rights. Any right to
acquire Shares under the Plan (other than an Option) shall automatically expire
if not exercised by the Purchaser within 30 days after the grant of such right
was communicated to the Purchaser by the Company. Such right shall not be
transferable and shall be exercisable only by the Purchaser to whom such right
was granted.
(c) Purchase Price. The Purchase Price of Shares to be offered under the
Plan shall not be less than 85% of the Fair Market Value of such Shares, and a
higher percentage may be required by Section 3(b). Subject to the preceding
sentence, the Purchase Price shall be determined by the Board of Directors at
its sole discretion. The Purchase Price shall be payable in a form described in
Section 7.
(d) Withholding Taxes. As a condition to the purchase of Shares, the
Purchaser shall make such arrangements as the Board of Directors may require for
the satisfaction of any
_______________________
/1/ Reflects stock split approved by the Board of Directors in May 1999 and a
500,000 share increase on February 1, 2000.
2
<PAGE>
federal, state, local or foreign withholding tax obligations that may arise in
connection with such purchase.
(e) Restrictions on Transfer of Shares and Minimum Vesting. Any Shares
awarded or sold under the Plan shall be subject to such special forfeiture
conditions, rights of repurchase, rights of first refusal and other transfer
restrictions as the Board of Directors may determine. Such restrictions shall be
set forth in the applicable Stock Purchase Agreement and shall apply in addition
to any restrictions that may apply to holders of Shares generally. In the case
of a Purchaser who is not an officer of the Company, an Outside Director or a
Consultant, any right to repurchase the Purchaser's Shares at the original
Purchase Price (if any) upon termination of the Purchaser's Service shall lapse
at least as rapidly as 20% per year over the five-year period commencing on the
date of the award or sale of the Shares. Any such right may be exercised only
within 90 days after the termination of the Purchaser's Service for cash or for
cancellation of indebtedness incurred in purchasing the Shares.
(f) Accelerated Vesting. Unless the applicable Stock Purchase Agreement
provides otherwise, any right to repurchase a Purchaser's Shares at the original
Purchase Price (if any) upon termination of the Purchaser's Service shall lapse
and all of such Shares shall become vested if (i) the Company is subject to a
Change in Control before the Purchaser's Service terminates and (ii) the
repurchase right is not assigned to the entity that employs the Purchaser
immediately after the Change in Control or to its parent or subsidiary.
SECTION 6. TERMS AND CONDITIONS OF OPTIONS.
(a) Stock Option Agreement. Each grant of an Option under the Plan shall
be evidenced by a Stock Option Agreement between the Optionee and the Company.
Such Option shall be subject to all applicable terms and conditions of the Plan
and may be subject to any other terms and conditions which are not inconsistent
with the Plan and which the Board of Directors deems appropriate for inclusion
in a Stock Option Agreement. The provisions of the various Stock Option
Agreements entered into under the Plan need not be identical.
(b) Number of Shares. Each Stock Option Agreement shall specify the number
of Shares that are subject to the Option and shall provide for the adjustment of
such number in accordance with Section 8. The Stock Option Agreement shall also
specify whether the Option is an ISO or a Nonstatutory Option.
(c) Exercise Price. Each Stock Option Agreement shall specify the Exercise
Price. The Exercise Price of an ISO shall not be less than 100% of the Fair
Market Value of a Share on the date of grant, and a higher percentage may be
required by Section 3(b). The Exercise Price of a Nonstatutory Option shall not
be less than 85% of the Fair Market Value of a Share on the date of grant, and a
higher percentage may be required by Section 3(b). Subject to the preceding two
sentences, the Exercise Price under any Option shall be determined by the Board
of Directors at its sole discretion. The Exercise Price shall be payable in a
form described in Section 7.
(d) Withholding Taxes. As a condition to the exercise of an Option, the
Optionee shall make such arrangements as the Board of Directors may require for
the satisfaction of any
3
<PAGE>
federal, state, local or foreign withholding tax obligations that may arise in
connection with such exercise. The Optionee shall also make such arrangements as
the Board of Directors may require for the satisfaction of any federal, state,
local or foreign withholding tax obligations that may arise in connection with
the disposition of Shares acquired by exercising an Option.
(e) Exercisability. Each Stock Option Agreement shall specify the date
when all or any installment of the Option is to become exercisable. In the case
of an Optionee who is not an officer of the Company, an Outside Director or a
Consultant, an Option shall become exercisable at least as rapidly as 20% per
year over the five-year period commencing on the date of grant. Subject to the
preceding sentence, the exercisability provisions of any Stock Option Agreement
shall be determined by the Board of Directors at its sole discretion.
(f) Accelerated Exercisability. Unless the applicable Stock Option
Agreement provides otherwise, all of an Optionee's Options shall become
exercisable in full if (i) the Company is subject to a Change in Control before
the Optionee's Service terminates, (ii) such Options do not remain outstanding,
(iii) such Options are not assumed by the surviving corporation or its parent
and (iv) the surviving corporation or its parent does not substitute options
with substantially the same terms for such Options.
(g) Basic Term. The Stock Option Agreement shall specify the term of the
Option. The term shall not exceed 10 years from the date of grant, and a shorter
term may be required by Section 3(b). Subject to the preceding sentence, the
Board of Directors at its sole discretion shall determine when an Option is to
expire.
(h) Nontransferability. No Option shall be transferable by the Optionee
other than by beneficiary designation, will or the laws of descent and
distribution. An Option may be exercised during the lifetime of the Optionee
only by the Optionee or by the Optionee's guardian or legal representative. No
Option or interest therein may be transferred, assigned, pledged or hypothecated
by the Optionee during the Optionee's lifetime, whether by operation of law or
otherwise, or be made subject to execution, attachment or similar process.
(i) Termination of Service (Except by Death). If an Optionee's Service
terminates for any reason other than the Optionee's death, then the Optionee's
Options shall expire on the earliest of the following occasions:
(i) The expiration date determined pursuant to Subsection (g) above;
(ii) The date three months after the termination of the Optionee's
Service for any reason other than Disability, or such later date as the
Board of Directors may determine; or
(iii) The date six months after the termination of the Optionee's
Service by reason of Disability, or such later date as the Board of
Directors may determine.
The Optionee may exercise all or part of the Optionee's Options at any time
before the expiration of such Options under the preceding sentence, but only to
the extent that such Options had become exercisable before the Optionee's
Service terminated (or became exercisable as a result
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of the termination) and the underlying Shares had vested before the Optionee's
Service terminated (or vested as a result of the termination). The balance of
such Options shall lapse when the Optionee's Service terminates. In the event
that the Optionee dies after the termination of the Optionee's Service but
before the expiration of the Optionee's Options, all or part of such Options may
be exercised (prior to expiration) by the executors or administrators of the
Optionee's estate or by any person who has acquired such Options directly from
the Optionee by beneficiary designation, bequest or inheritance, but only to the
extent that such Options had become exercisable before the Optionee's Service
terminated (or became exercisable as a result of the termination) and the
underlying Shares had vested before the Optionee's Service terminated (or vested
as a result of the termination).
(j) Leaves of Absence. For purposes of Subsection (i) above, Service shall
be deemed to continue while the Optionee is on a bona fide leave of absence, if
such leave was approved by the Company in writing and if continued crediting of
Service for this purpose is expressly required by the terms of such leave or by
applicable law (as determined by the Company).
(k) Death of Optionee. If an Optionee dies while the Optionee is in
Service, then the Optionee's Options shall expire on the earlier of the
following dates:
(i) The expiration date determined pursuant to Subsection (g) above;
or
(ii) The date 12 months after the Optionee's death.
All or part of the Optionee's Options may be exercised at any time before the
expiration of such Options under the preceding sentence by the executors or
administrators of the Optionee's estate or by any person who has acquired such
Options directly from the Optionee by beneficiary designation, bequest or
inheritance, but only to the extent that such Options had become exercisable
before the Optionee's death or became exercisable as a result of the death. The
balance of such Options shall lapse when the Optionee dies.
(l) No Rights as a Stockholder. An Optionee, or a transferee of an
Optionee, shall have no rights as a stockholder with respect to any Shares
covered by the Optionee's Option until such person becomes entitled to receive
such Shares by filing a notice of exercise and paying the Exercise Price
pursuant to the terms of such Option.
(m) Modification, Extension and Assumption of Options. Within the
limitations of the Plan, the Board of Directors may modify, extend or assume
outstanding Options or may accept the cancellation of outstanding Options
(whether granted by the Company or another issuer) in return for the grant of
new Options for the same or a different number of Shares and at the same or a
different Exercise Price. The foregoing notwithstanding, no modification of an
Option shall, without the consent of the Optionee, impair the Optionee's rights
or increase the Optionee's obligations under such Option.
(n) Restrictions on Transfer of Shares and Minimum Vesting. Any Shares
issued upon exercise of an Option shall be subject to such special forfeiture
conditions, rights of repurchase, rights of first refusal and other transfer
restrictions as the Board of Directors may
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determine. Such restrictions shall be set forth in the applicable Stock Option
Agreement and shall apply in addition to any restrictions that may apply to
holders of Shares generally. In the case of an Optionee who is not an officer of
the Company, an Outside Director or a Consultant:
(i) Any right to repurchase the Optionee's Shares at the original
Exercise Price upon termination of the Optionee's Service shall lapse at
least as rapidly as 20% per year over the five-year period commencing on
the date of the option grant;
(ii) Any such right may be exercised only for cash or for cancellation of
indebtedness incurred in purchasing the Shares; and
(iii) Any such right may be exercised only within 90 days after the later
of (A) the termination of the Optionee's Service or (B) the date of the
option exercise.
(o) Accelerated Vesting. Unless the applicable Stock Option Agreement
provides otherwise, any right to repurchase an Optionee's Shares at the original
Exercise Price upon termination of the Optionee's Service shall lapse and all of
such Shares shall become vested if (i) the Company is subject to a Change in
Control before the Optionee's Service terminates and (ii) the repurchase right
is not assigned to the entity that employs the Optionee immediately after the
Change in Control or to its parent or subsidiary.
SECTION 7. PAYMENT FOR SHARES.
(a) General Rule. The entire Purchase Price or Exercise Price of Shares
issued under the Plan shall be payable in cash or cash equivalents at the time
when such Shares are purchased, except as otherwise provided in this Section 7.
(b) Surrender of Stock. To the extent that a Stock Option Agreement so
provides, all or any part of the Exercise Price may be paid by surrendering, or
attesting to the ownership of, Shares that are already owned by the Optionee.
Such Shares shall be surrendered to the Company in good form for transfer and
shall be valued at their Fair Market Value on the date when the Option is
exercised. The Optionee shall not surrender, or attest to the ownership of,
Shares in payment of the Exercise Price if such action would cause the Company
to recognize compensation expense (or additional compensation expense) with
respect to the Option for financial reporting purposes.
(c) Services Rendered. At the discretion of the Board of Directors,
Shares may be awarded under the Plan in consideration of services rendered to
the Company, a Parent or a Subsidiary prior to the award.
(d) Promissory Note. To the extent that a Stock Option Agreement or Stock
Purchase Agreement so provides, all or a portion of the Exercise Price or
Purchase Price (as the case may be) of Shares issued under the Plan may be paid
with a full-recourse promissory note. However, the par value of the Shares, if
newly issued, shall be paid in cash or cash equivalents. The Shares shall be
pledged as security for payment of the principal amount of the promissory
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note and interest thereon. The interest rate payable under the terms of the
promissory note shall not be less than the minimum rate (if any) required to
avoid the imputation of additional interest under the Code. Subject to the
foregoing, the Board of Directors (at its sole discretion) shall specify the
term, interest rate, amortization requirements (if any) and other provisions of
such note.
(e) Exercise/Sale. To the extent that a Stock Option Agreement so
provides, and if Stock is publicly traded, payment may be made all or in part by
the delivery (on a form prescribed by the Company) of an irrevocable direction
to a securities broker approved by the Company to sell Shares and to deliver all
or part of the sales proceeds to the Company in payment of all or part of the
Exercise Price and any withholding taxes.
(f) Exercise/Pledge. To the extent that a Stock Option Agreement so
provides, and if Stock is publicly traded, payment may be made all or in part by
the delivery (on a form prescribed by the Company) of an irrevocable direction
to pledge Shares to a securities broker or lender approved by the Company, as
security for a loan, and to deliver all or part of the loan proceeds to the
Company in payment of all or part of the Exercise Price and any withholding
taxes.
SECTION 8. ADJUSTMENT OF SHARES.
(a) General. In the event of a subdivision of the outstanding Stock, a
declaration of a dividend payable in Shares, a declaration of an extraordinary
dividend payable in a form other than Shares in an amount that has a material
effect on the Fair Market Value of the Stock, a combination or consolidation of
the outstanding Stock into a lesser number of Shares, a recapitalization, a
spin-off, a reclassification or a similar occurrence, the Board of Directors
shall make appropriate adjustments in one or more of (i) the number of Shares
available for future grants under Section 4, (ii) the number of Shares covered
by each outstanding Option or (iii) the Exercise Price under each outstanding
Option.
(b) Mergers and Consolidations. In the event that the Company is a party
to a merger or consolidation, outstanding Options shall be subject to the
agreement of merger or consolidation. Such agreement, without the Optionees'
consent, may provide for:
(i) The continuation of such outstanding Options by the Company (if
the Company is the surviving corporation);
(ii) The assumption of the Plan and such outstanding Options by the
surviving corporation or its parent;
(iii) The substitution by the surviving corporation or its parent of
options with substantially the same terms for such outstanding Options; or
(iv) The cancellation of such outstanding Options without payment of
any consideration.
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(c) Reservation of Rights. Except as provided in this Section 8, an
Optionee or Purchaser shall have no rights by reason of (i) any subdivision or
consolidation of shares of stock of any class, (ii) the payment of any dividend
or (iii) any other increase or decrease in the number of shares of stock of any
class. Any issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number or
Exercise Price of Shares subject to an Option. The grant of an Option pursuant
to the Plan shall not affect in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or changes of its capital
or business structure, to merge or consolidate or to dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 9. SECURITIES LAW REQUIREMENTS.
(a) General. Shares shall not be issued under the Plan unless the issuance
and delivery of such Shares comply with (or are exempt from) all applicable
requirements of law, including (without limitation) the Securities Act of 1933,
as amended, the rules and regulations promulgated thereunder, state securities
laws and regulations, and the regulations of any stock exchange or other
securities market on which the Company's securities may then be traded.
(b) Financial Reports. The Company each year shall furnish to Optionees,
Purchasers and stockholders who have received Stock under the Plan its balance
sheet and income statement, unless such Optionees, Purchasers or stockholders
are key Employees whose duties with the Company assure them access to equivalent
information. Such balance sheet and income statement need not be audited.
SECTION 10. NO RETENTION RIGHTS.
Nothing in the Plan or in any right or Option granted under the Plan shall
confer upon the Purchaser or Optionee any right to continue in Service for any
period of specific duration or interfere with or otherwise restrict in any way
the rights of the Company (or any Parent or Subsidiary employing or retaining
the Purchaser or Optionee) or of the Purchaser or Optionee, which rights are
hereby expressly reserved by each, to terminate his or her Service at any time
and for any reason, with or without cause.
SECTION 11. DURATION AND AMENDMENTS.
(a) Term of the Plan. The Plan, as set forth herein, shall become
effective on the date of its adoption by the Board of Directors, subject to the
approval of the Company's stockholders. In the event that the stockholders fail
to approve the Plan within 12 months after its adoption by the Board of
Directors, any grants of Options or sales or awards of Shares that have already
occurred shall be rescinded, and no additional grants, sales or awards shall be
made thereafter under the Plan. The Plan shall terminate automatically 10 years
after its adoption by the Board of Directors and may be terminated on any
earlier date pursuant to Subsection (b) below.
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(b) Right to Amend or Terminate the Plan. The Board of Directors may
amend, suspend or terminate the Plan at any time and for any reason; provided,
however, that any amendment of the Plan which increases the number of Shares
available for issuance under the Plan (except as provided in Section 8), or
which materially changes the class of persons who are eligible for the grant of
ISOs, shall be subject to the approval of the Company's stockholders.
Stockholder approval shall not be required for any other amendment of the Plan.
(c) Effect of Amendment or Termination. No Shares shall be issued or sold
under the Plan after the termination thereof, except upon exercise of an Option
granted prior to such termination. The termination of the Plan, or any amendment
thereof, shall not affect any Share previously issued or any Option previously
granted under the Plan.
SECTION 12. DEFINITIONS.
(a) "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time.
(b) "Change in Control" shall mean:
(i) The consummation of a merger or consolidation of the Company
with or into another entity or any other corporate reorganization, if
persons who were not stockholders of the Company immediately prior to such
merger, consolidation or other reorganization own immediately after such
merger, consolidation or other reorganization 50% or more of the voting
power of the outstanding securities of each of (A) the continuing or
surviving entity and (B) any direct or indirect parent corporation of such
continuing or surviving entity; or
(ii) The sale, transfer or other disposition of all or substantially
all of the Company's assets.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(d) "Committee" shall mean a committee of the Board of Directors, as
described in Section 2(a).
(e) "Company" shall mean Kendara, Inc., a Delaware corporation.
(f) "Consultant" shall mean a person who performs bona fide services for
the Company, a Parent or a Subsidiary as a consultant or advisor, excluding
Employees and Outside Directors.
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(g) "Disability" shall mean that the Optionee is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment.
(h) "Employee" shall mean any individual who is a common-law employee of
the Company, a Parent or a Subsidiary.
(i) "Exercise Price" shall mean the amount for which one Share may be
purchased upon exercise of an Option, as specified by the Board of Directors in
the applicable Stock Option Agreement.
(j) "Fair Market Value" shall mean the fair market value of a Share, as
determined by the Board of Directors in good faith. Such determination shall be
conclusive and binding on all persons.
(k) "ISO" shall mean an employee incentive stock option described in
Section 422(b) of the Code.
(l) "Nonstatutory Option" shall mean a stock option not described in
Sections 422(b) or 423(b) of the Code.
(m) "Option" shall mean an ISO or Nonstatutory Option granted under the
Plan and entitling the holder to purchase Shares.
(n) "Optionee" shall mean an individual who holds an Option.
(o) "Outside Director" shall mean a member of the Board of Directors who
is not an Employee.
(p) "Parent" shall mean any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.
(q) "Plan" shall mean this Kendara, Inc. 1999 Stock Plan.
(r) "Purchase Price" shall mean the consideration for which one Share may
be acquired under the Plan (other than upon exercise of an Option), as specified
by the Board of Directors.
(s) "Purchaser" shall mean an individual to whom the Board of Directors
has offered the right to acquire Shares under the Plan (other than upon exercise
of an Option).
(t) "Service" shall mean service as an Employee, Outside Director or
Consultant.
(u) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 8 (if applicable).
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(v) "Stock" shall mean the Common Stock of the Company, with a par value
of $0.0001 per Share.
(w) "Stock Option Agreement" shall mean the agreement between the Company
and an Optionee which contains the terms, conditions and restrictions pertaining
to the Optionee's Option.
(x) "Stock Purchase Agreement" shall mean the agreement between the
Company and a Purchaser who acquires Shares under the Plan which contains the
terms, conditions and restrictions pertaining to the acquisition of such Shares.
(y) "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain. A corporation that attains
the status of a Subsidiary on a date after the adoption of the Plan shall be
considered a Subsidiary commencing as of such date.
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EXHIBIT 4.04
Kendara, Inc. 1999 Stock Plan
Notice of Stock Option Grant
You have been granted the following option to purchase Common Stock of
Kendara, Inc. (the "Company"):
Name of Optionee: (Name)
Total Number of Shares Granted: (TotalShares)
Type of Option: (ISO) Incentive Stock Option
(NSO) Nonstatutory Stock Option
Exercise Price Per Share: $(PricePerShare)
Date of Grant: (DateGrant)
Date Exercisable: This option may be exercised, in
whole or in part, for 100% of the
Shares subject to this option at any
time after the Date of Grant.
Vesting Commencement Date: (VestComDate)
Vesting Schedule: The Right of Repurchase shall lapse
with respect to the first 25% of the
Shares subject to this option when
the Optionee completes 12 months of
continuous Service after the Vesting
Commencement Date. The Right of
Repurchase shall lapse with respect
to an additional 1/48/th/ of the
Shares subject to this option when
the Optionee completes each month of
continuous Service thereafter.
Expiration Date: (ExpDate)
By your signature and the signature of the Company's representative below, you
and the Company agree that this option is granted under and governed by the
terms and conditions of the 1999 Stock Plan and the Stock Option Agreement, both
of which are attached to and made a part of this document.
Optionee: Kendara, Inc.
__________________________________ By:___________________________________
Title:________________________________
<PAGE>
THE OPTION GRANTED PURSUANT TO THIS AGREEMENT AND THE SHARES ISSUABLE UPON THE
EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN
EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT
REQUIRED.
Kendara, Inc. 1999 Stock Plan:
Stock Option Agreement
SECTION 1. GRANT OF OPTION.
(a) Option. On the terms and conditions set forth in the Notice of Stock
Option Grant and this Agreement, the Company grants to the Optionee on the Date
of Grant the option to purchase at the Exercise Price the number of Shares set
forth in the Notice of Stock Option Grant. The Exercise Price is agreed to be
at least 100% of the Fair Market Value per Share on the Date of Grant (110% of
Fair Market Value if Section 3(b) of the Plan applies). This option is intended
to be an ISO or a Nonstatutory Option, as provided in the Notice of Stock Option
Grant.
(b) Stock Plan and Defined Terms. This option is granted pursuant to the
Plan, a copy of which the Optionee acknowledges having received. The provisions
of the Plan are incorporated into this Agreement by this reference. Capitalized
terms are defined in Section 14 of this Agreement.
SECTION 2. RIGHT TO EXERCISE.
(a) Exercisability. Subject to Subsections (b) and (c) below and the
other conditions set forth in this Agreement, all or part of this option may be
exercised prior to its expiration at the time or times set forth in the Notice
of Stock Option Grant. Shares purchased by exercising this option may be
subject to the Right of Repurchase under Section 7.
(b) $100,000 Limitation. If this option is designated as an ISO in the
Notice of Stock Option Grant, then the Optionee's right to exercise this option
shall be deferred to the extent (and only to the extent) that this option
otherwise would not be treated as an ISO by reason of the $100,000 annual
limitation under Section 422(d) of the Code, except that:
(i) The Optionee's right to exercise this option shall in any event
become exercisable at least as rapidly as 20% per year over the five-year
period commencing on the Date of Grant, unless the Optionee is an officer
of the Company, an Outside Director or a Consultant; and
(ii) The Optionee's right to exercise this option shall no longer be
deferred if (A) the Company is subject to a Change in Control before the
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Optionee's Service terminates, (B) this option does not remain outstanding,
(C) this option is not assumed by the surviving corporation or its parent
and (D) the surviving corporation or its parent does not substitute an
option with substantially the same terms for this option.
(c) Stockholder Approval. Any other provision of this Agreement
notwithstanding, no portion of this option shall be exercisable at any time
prior to the approval of the Plan by the Company's stockholders.
SECTION 3. NO TRANSFER OR ASSIGNMENT OF OPTION.
Except as otherwise provided in this Agreement, this option and the
rights and privileges conferred hereby shall not be sold, pledged or otherwise
transferred (whether by operation of law or otherwise) and shall not be subject
to sale under execution, attachment, levy or similar process.
SECTION 4. EXERCISE PROCEDURES.
(a) Notice of Exercise. The Optionee or the Optionee's representative may
exercise this option by giving written notice to the Company pursuant to Section
13(c). The notice shall specify the election to exercise this option, the
number of Shares for which it is being exercised and the form of payment. The
notice shall be signed by the person exercising this option. In the event that
this option is being exercised by the representative of the Optionee, the notice
shall be accompanied by proof (satisfactory to the Company) of the
representative's right to exercise this option. The Optionee or the Optionee's
representative shall deliver to the Company, at the time of giving the notice,
payment in a form permissible under Section 5 for the full amount of the
Purchase Price.
(b) Issuance of Shares. After receiving a proper notice of exercise, the
Company shall cause to be issued a certificate or certificates for the Shares as
to which this option has been exercised, registered in the name of the person
exercising this option (or in the names of such person and his or her spouse as
community property or as joint tenants with right of survivorship). The Company
shall cause such certificate or certificates to be deposited in escrow or
delivered to or upon the order of the person exercising this option.
(c) Withholding Taxes. In the event that the Company determines that it
is required to withhold any tax as a result of the exercise of this option, the
Optionee, as a condition to the exercise of this option, shall make arrangements
satisfactory to the Company to enable it to satisfy all withholding
requirements. The Optionee shall also make arrangements satisfactory to the
Company to enable it to satisfy any withholding requirements that may arise in
connection with the vesting or disposition of Shares purchased by exercising
this option.
SECTION 5. PAYMENT FOR STOCK.
(a) Cash. All or part of the Purchase Price may be paid in cash or cash
equivalents.
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(b) Surrender of Stock. All or any part of the Purchase Price may be paid
by surrendering, or attesting to the ownership of, Shares that are already owned
by the Optionee. Such Shares shall be surrendered to the Company in good form
for transfer and shall be valued at their Fair Market Value on the date when
this option is exercised. The Optionee shall not surrender, or attest to the
ownership of, Shares in payment of the Purchase Price if such action would cause
the Company to recognize compensation expense (or additional compensation
expense) with respect to this option for financial reporting purposes.
(c) Exercise/Sale. If Stock is publicly traded, all or part of the
Purchase Price and any withholding taxes may be paid by the delivery (on a form
prescribed by the Company) of an irrevocable direction to a securities broker
approved by the Company to sell Shares and to deliver all or part of the sales
proceeds to the Company.
(d) Exercise/Pledge. If Stock is publicly traded, all or part of the
Purchase Price and any withholding taxes may be paid by the delivery (on a form
prescribed by the Company) of an irrevocable direction to pledge Shares to a
securities broker or lender approved by the Company, as security for a loan, and
to deliver all or part of the loan proceeds to the Company.
SECTION 6. TERM AND EXPIRATION.
(a) Basic Term. This option shall in any event expire on the expiration
date set forth in the Notice of Stock Option Grant, which date is 10 years after
the Date of Grant (five years after the Date of Grant if this option is
designated as an ISO in the Notice of Stock Option Grant and Section 3(b) of the
Plan applies).
(b) Termination of Service (Except by Death). If the Optionee's Service
terminates for any reason other than death, then this option shall expire on the
earliest of the following occasions:
(i) The expiration date determined pursuant to Subsection (a) above;
(ii) The date three months after the termination of the Optionee's
Service for any reason other than Disability; or
(iii) The date six months after the termination of the Optionee's
Service by reason of Disability.
The Optionee may exercise all or part of this option at any time before its
expiration under the preceding sentence, but only to the extent that this option
had become exercisable for vested shares before the Optionee's Service
terminated. When the Optionee's Service terminates, this option shall expire
immediately with respect to the number of Shares for which this option is not
yet exercisable and with respect to any Restricted Shares. In the event that
the Optionee dies after termination of Service but before the expiration of this
option, all or part of this option may be exercised (prior to expiration) by the
executors or administrators of the Optionee's estate or by any person who has
acquired this option directly from the Optionee by beneficiary designation,
bequest or inheritance, but only to the extent that this option had become
exercisable before the Optionee's Service terminated.
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(c) Death of the Optionee. If the Optionee dies while in Service, then
this option shall expire on the earlier of the following dates:
(i) The expiration date determined pursuant to Subsection (a) above;
or
(ii) The date 12 months after the Optionee's death.
All or part of this option may be exercised at any time before its expiration
under the preceding sentence by the executors or administrators of the
Optionee's estate or by any person who has acquired this option directly from
the Optionee by beneficiary designation, bequest or inheritance, but only to the
extent that this option had become exercisable before the Optionee's death. When
the Optionee dies, this option shall expire immediately with respect to the
number of Shares for which this option is not yet exercisable and with respect
to any Restricted Shares.
(d) Leaves of Absence. For any purpose under this Agreement, Service
shall be deemed to continue while the Optionee is on a bona fide leave of
absence, if such leave was approved by the Company in writing and if continued
crediting of Service for such purpose is expressly required by the terms of such
leave or by applicable law (as determined by the Company).
(e) Notice Concerning ISO Treatment. If this option is designated as an
ISO in the Notice of Stock Option Grant, it ceases to qualify for favorable tax
treatment as an ISO to the extent it is exercised (i) more than three months
after the date the Optionee ceases to be an Employee for any reason other than
death or permanent and total disability (as defined in Section 22(e)(3) of the
Code), (ii) more than 12 months after the date the Optionee ceases to be an
Employee by reason of such permanent and total disability or (iii) after the
Optionee has been on a leave of absence for more than 90 days, unless the
Optionee's reemployment rights are guaranteed by statute or by contract.
SECTION 7. RIGHT OF REPURCHASE.
(a) Scope of Repurchase Right. Unless they have become vested in
accordance with the Notice of Stock Option Grant and Subsection (c) below, the
Shares acquired under this Agreement initially shall be Restricted Shares and
shall be subject to a right (but not an obligation) of repurchase by the
Company. The Optionee shall not transfer, assign, encumber or otherwise dispose
of any Restricted Shares, except as provided in the following sentence. The
Optionee may transfer Restricted Shares (i) by beneficiary designation, will or
intestate succession or (ii) to the Optionee's spouse, children or grandchildren
or to a trust established by the Optionee for the benefit of the Optionee or the
Optionee's spouse, children or grandchildren, provided in either case that the
Transferee agrees in writing on a form prescribed by the Company to be bound by
all provisions of this Agreement. If the Optionee transfers any Restricted
Shares, then this Section 7 shall apply to the Transferee to the same extent as
to the Optionee.
(b) Condition Precedent to Exercise. The Right of Repurchase shall be
exercisable with respect to any Restricted Shares only during the 60-day period
next following the later of:
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(i) The date when the Optionee's Service terminates for any
reason, with or without cause, including (without limitation) death or
disability; or
(ii) The date when such Restricted Shares were purchased by the
Optionee, the executors or administrators of the Optionee's estate or any
person who has acquired this option directly from the Optionee by bequest,
inheritance or beneficiary designation.
(c) Lapse of Repurchase Right. The Right of Repurchase shall lapse
with respect to the Shares subject to this option in accordance with the vesting
schedule set forth in the Notice of Stock Option Grant. In addition, the Right
of Repurchase shall lapse and all of the remaining Restricted Shares shall
become vested if (i) the Company is subject to a Change in Control before the
Optionee's Service terminates and (ii) the Right of Repurchase is not assigned
to the entity that employs the Optionee immediately after the Change in Control
or to its parent or subsidiary.
(d) Repurchase Cost. If the Company exercises the Right of
Repurchase, it shall pay the Optionee an amount equal to the Exercise Price for
each of the Restricted Shares being repurchased.
(e) Exercise of Repurchase Right. The Right of Repurchase shall be
exercisable only by written notice delivered to the Optionee prior to the
expiration of the 60-day period specified in Subsection (b) above. The notice
shall set forth the date on which the repurchase is to be effected. Such date
shall not be more than 30 days after the date of the notice. The certificate(s)
representing the Restricted Shares to be repurchased shall, prior to the close
of business on the date specified for the repurchase, be delivered to the
Company properly endorsed for transfer. The Company shall, concurrently with
the receipt of such certificate(s), pay to the Optionee the purchase price
determined according to Subsection (d) above. Payment shall be made in cash or
cash equivalents or by canceling indebtedness to the Company incurred by the
Optionee in the purchase of the Restricted Shares. The Right of Repurchase
shall terminate with respect to any Restricted Shares for which it has not been
timely exercised pursuant to this Subsection (e).
(f) Additional Shares or Substituted Securities. In the event of the
declaration of a stock dividend, the declaration of an extraordinary dividend
payable in a form other than stock, a spin-off, a stock split, an adjustment in
conversion ratio, a recapitalization or a similar transaction affecting the
Company's outstanding securities without receipt of consideration, any new,
substituted or additional securities or other property (including money paid
other than as an ordinary cash dividend) which are by reason of such transaction
distributed with respect to any Restricted Shares or into which such Restricted
Shares thereby become convertible shall immediately be subject to the Right of
Repurchase. Appropriate adjustments to reflect the distribution of such
securities or property shall be made to the number and/or class of the
Restricted Shares. Appropriate adjustments shall also, after each such
transaction, be made to the price per share to be paid upon the exercise of the
Right of Repurchase in order to reflect any change in the Company's outstanding
securities effected without receipt of consideration therefor; provided,
however, that the aggregate purchase price payable for the Restricted Shares
shall remain the same.
5
<PAGE>
(g) Termination of Rights as Stockholder. If the Company makes available,
at the time and place and in the amount and form provided in this Agreement, the
consideration for the Restricted Shares to be repurchased in accordance with
this Section 7, then after such time the person from whom such Restricted Shares
are to be repurchased shall no longer have any rights as a holder of such
Restricted Shares (other than the right to receive payment of such consideration
in accordance with this Agreement). Such Restricted Shares shall be deemed to
have been repurchased in accordance with the applicable provisions hereof,
whether or not the certificate(s) therefor have been delivered as required by
this Agreement.
(h) Escrow. Upon issuance, the certificates for Restricted Shares shall
be deposited in escrow with the Company to be held in accordance with the
provisions of this Agreement. Any new, substituted or additional securities or
other property described in Subsection (f) above shall immediately be delivered
to the Company to be held in escrow, but only to the extent the Shares are at
the time Restricted Shares. All regular cash dividends on Restricted Shares (or
other securities at the time held in escrow) shall be paid directly to the
Optionee and shall not be held in escrow. Restricted Shares, together with any
other assets or securities held in escrow hereunder, shall be (i) surrendered to
the Company for repurchase and cancellation upon the Company's exercise of its
Right of Repurchase or Right of First Refusal or (ii) released to the Optionee
upon the Optionee's request to the extent the Shares are no longer Restricted
Shares (but not more frequently than once every six months). In any event, all
Shares which have vested (and any other vested assets and securities
attributable thereto) shall be released within 60 days after the earlier of (i)
the Optionee's cessation of Service or (ii) the lapse of the Right of First
Refusal.
SECTION 8. RIGHT OF FIRST REFUSAL.
(a) Right of First Refusal. In the event that the Optionee proposes to
sell, pledge or otherwise transfer to a third party any Shares acquired under
this Agreement, or any interest in such Shares, the Company shall have the Right
of First Refusal with respect to all (and not less than all) of such Shares. If
the Optionee desires to transfer Shares acquired under this Agreement, the
Optionee shall give a written Transfer Notice to the Company describing fully
the proposed transfer, including the number of Shares proposed to be
transferred, the proposed transfer price, the name and address of the proposed
Transferee and proof satisfactory to the Company that the proposed sale or
transfer will not violate any applicable federal or state securities laws. The
Transfer Notice shall be signed both by the Optionee and by the proposed
Transferee and must constitute a binding commitment of both parties to the
transfer of the Shares. The Company shall have the right to purchase all, and
not less than all, of the Shares on the terms of the proposal described in the
Transfer Notice (subject, however, to any change in such terms permitted under
Subsection (b) below) by delivery of a notice of exercise of the Right of First
Refusal within 30 days after the date when the Transfer Notice was received by
the Company. The Company's rights under this Subsection (a) shall be freely
assignable, in whole or in part.
(b) Transfer of Shares. If the Company fails to exercise its Right of
First Refusal within 30 days after the date when it received the Transfer
Notice, the Optionee may, not later than 90 days following receipt of the
Transfer Notice by the Company, conclude a transfer of the Shares subject to the
Transfer Notice on the terms and conditions described in the Transfer Notice,
provided that any such sale is made in compliance with applicable federal and
state
6
<PAGE>
securities laws and not in violation of any other contractual restrictions
to which the Optionee is bound. Any proposed transfer on terms and conditions
different from those described in the Transfer Notice, as well as any subsequent
proposed transfer by the Optionee, shall again be subject to the Right of First
Refusal and shall require compliance with the procedure described in Subsection
(a) above. If the Company exercises its Right of First Refusal, the parties
shall consummate the sale of the Shares on the terms set forth in the Transfer
Notice within 60 days after the date when the Company received the Transfer
Notice (or within such longer period as may have been specified in the Transfer
Notice); provided, however, that in the event the Transfer Notice provided that
payment for the Shares was to be made in a form other than cash or cash
equivalents paid at the time of transfer, the Company shall have the option of
paying for the Shares with cash or cash equivalents equal to the present value
of the consideration described in the Transfer Notice.
(c) Additional Shares or Substituted Securities. In the event of the
declaration of a stock dividend, the declaration of an extraordinary dividend
payable in a form other than stock, a spin-off, a stock split, an adjustment in
conversion ratio, a recapitalization or a similar transaction affecting the
Company's outstanding securities without receipt of consideration, any new,
substituted or additional securities or other property (including money paid
other than as an ordinary cash dividend) which are by reason of such transaction
distributed with respect to any Shares subject to this Section 8 or into which
such Shares thereby become convertible shall immediately be subject to this
Section 8. Appropriate adjustments to reflect the distribution of such
securities or property shall be made to the number and/or class of the Shares
subject to this Section 8.
(d) Termination of Right of First Refusal. Any other provision of this
Section 8 notwithstanding, in the event that the Stock is readily tradable on an
established securities market when the Optionee desires to transfer Shares, the
Company shall have no Right of First Refusal, and the Optionee shall have no
obligation to comply with the procedures prescribed by Subsections (a) and (b)
above.
(e) Permitted Transfers. This Section 8 shall not apply to (i) a transfer
by beneficiary designation, will or intestate succession or (ii) a transfer to
the Optionee's spouse, children or grandchildren or to a trust established by
the Optionee for the benefit of the Optionee or the Optionee's spouse, children
or grandchildren, provided in either case that the Transferee agrees in writing
on a form prescribed by the Company to be bound by all provisions of this
Agreement. If the Optionee transfers any Shares acquired under this Agreement,
either under this Subsection (e) or after the Company has failed to exercise the
Right of First Refusal, then this Section 8 shall apply to the Transferee to the
same extent as to the Optionee.
(f) Termination of Rights as Stockholder. If the Company makes available,
at the time and place and in the amount and form provided in this Agreement, the
consideration for the Shares to be purchased in accordance with this Section 8,
then after such time the person from whom such Shares are to be purchased shall
no longer have any rights as a holder of such Shares (other than the right to
receive payment of such consideration in accordance with this Agreement). Such
Shares shall be deemed to have been purchased in accordance with the applicable
provisions hereof, whether or not the certificate(s) therefor have been
delivered as required by this Agreement.
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<PAGE>
SECTION 9. LEGALITY OF INITIAL ISSUANCE.
No Shares shall be issued upon the exercise of this option unless and until
the Company has determined that:
(a) It and the Optionee have taken any actions required to register the
Shares under the Securities Act or to perfect an exemption from the registration
requirements thereof;
(b) Any applicable listing requirement of any stock exchange or other
securities market on which Stock is listed has been satisfied; and
(c) Any other applicable provision of state or federal law has been
satisfied.
SECTION 10. NO REGISTRATION RIGHTS.
The Company may, but shall not be obligated to, register or qualify
the sale of Shares under the Securities Act or any other applicable law. The
Company shall not be obligated to take any affirmative action in order to cause
the sale of Shares under this Agreement to comply with any law.
SECTION 11. RESTRICTIONS ON TRANSFER.
(a) Securities Law Restrictions. Regardless of whether the offering and
sale of Shares under the Plan have been registered under the Securities Act or
have been registered or qualified under the securities laws of any state, the
Company at its discretion may impose restrictions upon the sale, pledge or other
transfer of such Shares (including the placement of appropriate legends on stock
certificates or the imposition of stop-transfer instructions) if, in the
judgment of the Company, such restrictions are necessary or desirable in order
to achieve compliance with the Securities Act, the securities laws of any state
or any other law.
(b) Market Stand-Off. In connection with any underwritten public offering
by the Company of its equity securities pursuant to an effective registration
statement filed under the Securities Act, including the Company's initial public
offering, the Optionee shall not directly or indirectly sell, make any short
sale of, loan, hypothecate, pledge, offer, grant or sell any option or other
contract for the purchase of, purchase any option or other contract for the sale
of, or otherwise dispose of or transfer, or agree to engage in any of the
foregoing transactions with respect to, any Shares acquired under this Agreement
without the prior written consent of the Company or its underwriters. Such
restriction (the "Market Stand-Off") shall be in effect for such period of time
following the date of the final prospectus for the offering as may be requested
by the Company or such underwriters. In no event, however, shall such period
exceed 180 days. The Market Stand-Off shall in any event terminate two years
after the date of the Company's initial public offering. In the event of the
declaration of a stock dividend, a spin-off, a stock split, an adjustment in
conversion ratio, a recapitalization or a similar transaction affecting the
Company's outstanding securities without receipt of consideration, any new,
substituted or additional securities which are by reason of such transaction
distributed with respect to any Shares subject to the Market Stand-Off, or into
which such Shares thereby become convertible, shall immediately be subject to
the Market Stand-Off. In order to enforce the Market Stand-Off, the Company may
impose stop-transfer instructions with respect to the Shares
8
<PAGE>
acquired under this Agreement until the end of the applicable stand-off period.
The Company's underwriters shall be beneficiaries of the agreement set forth in
this Subsection (b). This Subsection (b) shall not apply to Shares registered in
the public offering under the Securities Act, and the Optionee shall be subject
to this Subsection (b) only if the directors and officers of the Company are
subject to similar arrangements.
(c) Investment Intent at Grant. The Optionee represents and agrees that
the Shares to be acquired upon exercising this option will be acquired for
investment, and not with a view to the sale or distribution thereof.
(d) Investment Intent at Exercise. In the event that the sale of Shares
under the Plan is not registered under the Securities Act but an exemption is
available which requires an investment representation or other representation,
the Optionee shall represent and agree at the time of exercise that the Shares
being acquired upon exercising this option are being acquired for investment,
and not with a view to the sale or distribution thereof, and shall make such
other representations as are deemed necessary or appropriate by the Company and
its counsel.
(e) Legends. All certificates evidencing Shares purchased under this
Agreement shall bear the following legend:
"THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED,
TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN
COMPLIANCE WITH THE TERMS OF A WRITTEN AGREEMENT BETWEEN THE
COMPANY AND THE REGISTERED HOLDER OF THE SHARES (OR THE
PREDECESSOR IN INTEREST TO THE SHARES). SUCH AGREEMENT GRANTS TO
THE COMPANY CERTAIN RIGHTS OF FIRST REFUSAL UPON AN ATTEMPTED
TRANSFER OF THE SHARES AND CERTAIN REPURCHASE RIGHTS UPON
TERMINATION OF SERVICE WITH THE COMPANY. THE SECRETARY OF THE
COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH
AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE."
All certificates evidencing Shares purchased under this Agreement in an
unregistered transaction shall bear the following legend (and such other
restrictive legends as are required or deemed advisable under the provisions of
any applicable law):
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED,
OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO
THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT
REQUIRED."
(f) Removal of Legends. If, in the opinion of the Company and its
counsel, any legend placed on a stock certificate representing Shares sold under
this Agreement is no longer
9
<PAGE>
required, the holder of such certificate shall be entitled to exchange such
certificate for a certificate representing the same number of Shares but without
such legend.
(g) Administration. Any determination by the Company and its counsel in
connection with any of the matters set forth in this Section 11 shall be
conclusive and binding on the Optionee and all other persons.
SECTION 12. ADJUSTMENT OF SHARES.
In the event of any transaction described in Section 8(a) of the Plan,
the terms of this option (including, without limitation, the number and kind of
Shares subject to this option and the Exercise Price) shall be adjusted as set
forth in Section 8(a) of the Plan. In the event that the Company is a party to
a merger or consolidation, this option shall be subject to the agreement of
merger or consolidation, as provided in Section 8(b) of the Plan.
SECTION 13. MISCELLANEOUS PROVISIONS.
(a) Rights as a Stockholder. Neither the Optionee nor the Optionee's
representative shall have any rights as a stockholder with respect to any Shares
subject to this option until the Optionee or the Optionee's representative
becomes entitled to receive such Shares by filing a notice of exercise and
paying the Purchase Price pursuant to Sections 4 and 5.
(b) No Retention Rights. Nothing in this option or in the Plan shall
confer upon the Optionee any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the rights
of the Company (or any Parent or Subsidiary employing or retaining the Optionee)
or of the Optionee, which rights are hereby expressly reserved by each, to
terminate his or her Service at any time and for any reason, with or without
cause.
(c) Notice. Any notice required by the terms of this Agreement shall be
given in writing and shall be deemed effective upon personal delivery or upon
deposit with the United States Postal Service, by registered or certified mail,
with postage and fees prepaid. Notice shall be addressed to the Company at its
principal executive office and to the Optionee at the address that he or she
most recently provided to the Company.
(d) Entire Agreement. The Notice of Stock Option Grant, this Agreement
and the Plan constitute the entire contract between the parties hereto with
regard to the subject matter hereof. They supersede any other agreements,
representations or understandings (whether oral or written and whether express
or implied) which relate to the subject matter hereof.
(e) Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of California, as such laws are applied
to contracts entered into and performed in such State.
SECTION 14. DEFINITIONS.
(a) "Agreement" shall mean this Stock Option Agreement.
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<PAGE>
(b) "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time or, if a Committee has been appointed, such
Committee.
(c) "Change in Control" shall mean:
(i) The consummation of a merger or consolidation of the
Company with or into another entity or any other corporate
reorganization, if persons who were not stockholders of the
Company immediately prior to such merger, consolidation or other
reorganization own immediately after such merger, consolidation
or other reorganization 50% or more of the voting power of the
outstanding securities of each of (A) the continuing or surviving
entity and (B) any direct or indirect parent corporation of such
continuing or surviving entity; or
(ii) The sale, transfer or other disposition of all or substantially
all of the Company's assets.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(e) "Committee" shall mean a committee of the Board of Directors, as
described in Section 2 of the Plan.
(f) "Company" shall mean Kendara, Inc., a Delaware corporation.
(g) "Consultant" shall mean a person who performs bona fide services for
the Company, a Parent or a Subsidiary as a consultant or advisor, excluding
Employees and Outside Directors.
(h) "Date of Grant" shall mean the date specified in the Notice of Stock
Option Grant, which date shall be the later of (i) the date on which the Board
of Directors resolved to grant this option or (ii) the first day of the
Optionee's Service.
(i) "Disability" shall mean that the Optionee is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment.
(j) "Employee" shall mean any individual who is a common-law employee of
the Company, a Parent or a Subsidiary.
(k) "Exercise Price" shall mean the amount for which one Share may be
purchased upon exercise of this option, as specified in the Notice of Stock
Option Grant.
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<PAGE>
(l) "Fair Market Value" shall mean the fair market value of a Share, as
determined by the Board of Directors in good faith. Such determination shall be
conclusive and binding on all persons.
(m) "ISO" shall mean an employee incentive stock option described in
Section 422(b) of the Code.
(n) "Nonstatutory Option" shall mean a stock option not described in
Sections 422(b) or 423(b) of the Code.
(o) "Notice of Stock Option Grant" shall mean the document so entitled to
which this Agreement is attached.
(p) "Optionee" shall mean the individual named in the Notice of Stock
Option Grant.
(q) "Outside Director" shall mean a member of the Board of Directors who
is not an Employee.
(r) "Parent" shall mean any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
(s) "Plan" shall mean the Kendara, Inc. 1999 Stock Plan, as in effect on
the Date of Grant.
(t) "Purchase Price" shall mean the Exercise Price multiplied by the
number of Shares with respect to which this option is being exercised.
(u) "Restricted Share" shall mean a Share that is subject to the Right of
Repurchase.
(v) "Right of First Refusal" shall mean the Company's right of first
refusal described in Section 8.
(w) "Right of Repurchase" shall mean the Company's right of repurchase
described in Section 7.
(x) "Securities Act" shall mean the Securities Act of 1933, as amended.
(y) "Service" shall mean service as an Employee, Outside Director or
Consultant.
(z) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 8 of the Plan (if applicable).
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<PAGE>
(aa) "Stock" shall mean the Common Stock of the Company, with a par value
of $0.0001 per Share.
(bb) "Subsidiary" shall mean any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.
(cc) "Transferee" shall mean any person to whom the Optionee has directly
or indirectly transferred any Share acquired under this Agreement.
(dd) "Transfer Notice" shall mean the notice of a proposed transfer of
Shares described in Section 8.
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<PAGE>
EXHIBIT 4.05
Kendara, Inc. 1999 Stock Plan
Notice of Stock Option Exercise
<TABLE>
<S> <C>
Optionee Information:
Name: _______________________________________ Social Security Number: _______ - ________ - _______
Address: _______________________________________ Employee Number: ____________________________
_______________________________________
Option Information:
Date of Grant: _________________ _________, 19 __ Type of Option: [_] Nonstatutory (NSO) or
[_] Incentive (ISO)
Exercise Price per share: $ _______________
Total number of shares of Common Stock of Kendara, Inc. ____________________ shares
(the "Company") covered by option:
</TABLE>
Exercise Information:
Number of shares of Common Stock of the Company for which option is being
exercised now:_________________. (These shares are referred to below as the
"Purchased Shares.")
Total Exercise Price for the Purchased Shares: $_________
Form of payment enclosed [check all that apply]:
<TABLE>
<S> <C>
[_] Check for $___________, [_] Certificate(s) for ______ shares of Common Stock of the
made payable to Company that I have owned for at least six months.
"Kendara, Inc." (These shares will be valued as of the date this notice
is received by the Company.)
[_] Attestation Form covering ______ shares of Common Stock
of the Company. (These shares will be valued as of the
date this notice is received by the Company.)
</TABLE>
Names in which the Purchased Shares should be registered [you must check one]:
<TABLE>
<S> <C>
[_] In my name only
[_] In the names of my spouse and myself as community property My spouse's name (if applicable):
[_] In the names of my spouse and myself as joint tenants with
the right of survivorship ___________________________________
</TABLE>
The certificate for the Purchased _______________________
Shares should be sent to the _______________________
following address: _______________________
You must sign this Notice on the second page before submitting it to the
Company.
<PAGE>
Representations and Acknowledgments of the Optionee:
1. I represent and warrant to the Company that I am acquiring and will hold
the Purchased Shares for investment for my account only, and not with a
view to, or for resale in connection with, any "distribution" of the
Purchased Shares within the meaning of the Securities Act of 1933, as
amended (the "Securities Act").
2. I understand that the Purchased Shares have not been registered under the
Securities Act by reason of a specific exemption therefrom and that the
Purchased Shares must be held indefinitely, unless they are subsequently
registered under the Securities Act or I obtain an opinion of counsel (in
form and substance satisfactory to the Company and its counsel) that
registration is not required.
3. I acknowledge that the Company is under no obligation to register the
Purchased Shares.
4. I am aware of the adoption of Rule 144 by the Securities and Exchange
Commission under the Securities Act, which permits limited public resales
of securities acquired in a non-public offering, subject to the
satisfaction of certain conditions. These conditions include (without
limitation) that certain current public information about the issuer is
available, that the resale occurs only after the holding period required by
Rule 144 has been satisfied, that the sale occurs through an unsolicited
"broker's transaction" and that the amount of securities being sold during
any three-month period does not exceed specified limitations. I understand
that the conditions for resale set forth in Rule 144 have not been
satisfied and that the Company has no plans to satisfy these conditions in
the foreseeable future.
5. I will not sell, transfer or otherwise dispose of the Purchased Shares in
violation of the Securities Act, the Securities Exchange Act of 1934, or
the rules promulgated thereunder, including Rule 144 under the Securities
Act.
6. I acknowledge that I have received and had access to such information as I
consider necessary or appropriate for deciding whether to invest in the
Purchased Shares and that I had an opportunity to ask questions and receive
answers from the Company regarding the terms and conditions of the issuance
of the Purchased Shares.
7. I am aware that my investment in the Company is a speculative investment
which has limited liquidity and is subject to the risk of complete loss. I
am able, without impairing my financial condition, to hold the Purchased
Shares for an indefinite period and to suffer a complete loss of my
investment in the Purchased Shares.
8. I acknowledge that the Purchased Shares remain subject to the Company's
right of first refusal and may remain subject to the Company's right of
repurchase at the exercise price, all in accordance with the applicable
Notice of Stock Option Grant and Stock Option Agreement.
9. I acknowledge that I am acquiring the Purchased Shares subject to all other
terms of the Notice of Stock Option Grant and Stock Option Agreement.
10. I acknowledge that I have received a copy of the Company's memorandum
regarding the federal income tax consequences of an option exercise and the
tax election under section 83(b) of the Internal Revenue Code. In the event
that I choose to make a section 83(b) election, I acknowledge that it is my
responsibility--and not the Company's responsibility--to file the election
in a timely manner, even if I ask the Company or its agents to make the
filing on my behalf. I acknowledge that the Company has encouraged me to
consult my own adviser to determine the tax consequences of acquiring the
Purchased Shares at this time.
11. I agree to seek the consent of my spouse to the extent required by the
Company to enforce the foregoing.
Signature: Date:
_______________________ _______________________
2
<PAGE>
Federal Income Tax Consequences and
Section 83(b) Election
(Current as of October 1998)
Purpose of This Memorandum
The purpose of this memorandum is to provide you with a brief summary of the tax
consequences of exercising your option. For a number of reasons, this memorandum
is no substitute for personal tax advice:
. To make the memorandum short and readable, only the highlights are covered.
Some tax rules are not addressed, even though they may be important in
particular cases.
. While the summary attempts to deal with the most common situations, your
own tax situation may well be different from the norm.
. State and foreign income taxes are not addressed at all, even though they
could have a significant impact on your tax planning. Likewise, federal
gift and estate taxes and state inheritance taxes are not discussed.
. Tax planning involving incentive stock options is exceedingly complex, in
part because of the possible application of the alternative minimum tax.
. The memorandum assumes that you are paying the exercise price of your
option in cash (or in the form of a full-recourse promissory note with an
interest rate that meets IRS requirements). If you are paying the exercise
price in the form of stock, you become subject to special rules that are
not addressed here.
. The tax rules change often, and the Company is not responsible for updating
this summary.
For these reasons, the Company strongly encourages you to consult your own tax
- ------------------------------------------------------------------------------
adviser before exercising your option and before making a decision about filing
- -------------------------------------------------------------------------------
or not filing a section 83(b) election.
- ---------------------------------------
Limit on ISO Treatment
The Notice of Stock Option Grant indicates whether your option is a nonstatutory
stock option (NSO) or an incentive stock option (ISO). The favorable tax
treatment for ISOs is limited, regardless of what the Notice of Stock Option
Grant indicates. Of the options that become exercisable in any calendar year,
only options covering the first $100,000 of stock are eligible for ISO
treatment. The excess over $100,000 automatically receives NSO treatment. For
this purpose, stock is valued at the time of grant. This means that the value is
generally equal to the exercise price.
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<PAGE>
For example, assume that you hold an option to buy 50,000 shares for $4 per
share. Assume further that the entire option is exercisable immediately after
the date of grant. (It is irrelevant when the underlying stock vests.) Only the
first 25,000 shares qualify for ISO treatment. (25,000 times $4 equals
$100,000.) The remaining 25,000 shares will be treated as if they had been
acquired by exercising an NSO. This is true regardless of when the option is
actually exercised; what matters is when it first could have been exercised.
Exercise of Nonstatutory Stock Option to Purchase Vested Shares
The Notice of Stock Option Grant indicates whether your Purchased Shares are
already vested. Vested shares are no longer subject to the Company's right to
repurchase them at the exercise price, although they are still subject to the
Company's right of first refusal. If you know that your Purchased Shares are
already vested, there is no need to file a section 83(b) election.
If you are exercising an NSO to purchase vested shares, you will be taxed now.
You will recognize ordinary income in an amount equal to the difference between
(a) the fair market value of the Purchased Shares on the date of exercise and
(b) the exercise price you are paying. If you are an employee or former employee
of the Company, this amount is subject to withholding for income and payroll
taxes. Your tax basis in the Purchased Shares (to calculate capital gain when
you sell the shares) is equal to their fair market value on the date of
exercise.
Exercise of NSO to Purchase Non-Vested Shares
If you are exercising an NSO to purchase non-vested shares, and if you do not
file a timely election under section 83(b) of the Internal Revenue Code, then
you will not be taxed now. Instead, you will be taxed whenever an increment of
Purchased Shares vests--in other words, when the Company no longer has the right
to repurchase those shares at the exercise price. The Notice of Stock Option
Grant indicates when this occurs, generally over a period of several years.
Whenever an increment of Purchased Shares vests, you will recognize ordinary
income in an amount equal to the difference between (a) the fair market value of
those Purchased Shares on the date of vesting and (b) the exercise price you are
paying for those Purchased Shares. If you are an employee or former employee of
the Company, this amount will be subject to withholding for income and payroll
taxes. Your tax basis in the Purchased Shares (to calculate capital gain when
you sell the shares) will be equal to their fair market value on the date of
vesting.
If you are exercising an NSO to purchase non-vested shares, and if you file a
timely election under section 83(b) of the Internal Revenue Code, then you will
be taxed now. You will recognize ordinary income in an amount equal to the
difference between (a) the fair market value of the Purchased Shares on the date
of exercise and (b) the exercise price you are paying. If you are an employee or
former employee of the Company, this amount is subject to withholding for income
and payroll taxes. Your tax basis in the Purchased Shares (to calculate capital
gain when you sell the shares) is equal to their fair market value on the date
of exercise. Even if the fair market value of the Purchased Shares on the date
of exercise equals the exercise price (and thus no tax is payable), the 83(b)
election must be made in order to avoid having any subsequent appreciation taxed
as ordinary income at the time of vesting.
4
<PAGE>
You must file an 83(b) election with the Internal Revenue Service within 30 days
- --------------------------------------------------------------------------------
after the Notice of Exercise of Stock Option is signed. The 30-day filing
- ------------------------------------------------------
period cannot be extended. If you miss the deadline, you will be taxed as the
Purchased Shares vest, based on the value of the shares at that time. (See
above.) The form for making the 83(b) election is attached. Additional copies of
the form must be filed with the Company and with your tax return for the year in
which you make the election.
Exercise of ISO and ISO Holding Periods
If you are exercising an ISO, you will not be taxed under the regular tax rules
until you dispose of the Purchased Shares./1/ (The alternative minimum tax rules
are described below.) The tax treatment at the time of disposition depends on
how long you hold the shares. You will satisfy the ISO holding periods if you
hold the Purchased Shares until the later of the following dates:
. The date two years after the ISO was granted, and
. The date one year after the ISO is exercised.
Disposition of ISO Shares
If you dispose of the Purchased Shares after satisfying both of the ISO holding
periods, then you will recognize only a long-term capital gain at the time of
disposition. The amount of the capital gain is equal to the difference between
(a) the sales proceeds and (b) the exercise price. In general, the maximum
marginal federal income tax rate on long-term capital gains is 20%.
If you dispose of the Purchased Shares before either or both of the ISO holding
periods are met, then you will recognize ordinary income at the time of
disposition. The calculation of the ordinary income amount depends on whether
the shares are vested at the time of exercise.
. Shares Vested. If the shares are vested at the time of exercise, the
amount of ordinary income will be equal to the difference between (a) the
fair market value of the Purchased Shares on the date of exercise and (b)
the exercise price. But if the disposition is an arm's length sale to an
unrelated party, the amount of ordinary income will not exceed the total
gain from the sale. Under current IRS rules, the ordinary income amount
will not be subject to withholding for income or payroll taxes. Your tax
basis in the Purchased Shares will be equal to their fair market value on
the date of exercise. Any gain in excess of your basis will be taxed as a
capital gain--either long-term or short-term, depending on how long you
hold the Purchased Shares after the date of exercise.
. Shares Not Vested--No 83(b) Election Filed. If the Purchased Shares are
not vested at the time of exercise, and if you do not file a timely
election under section 83(b) of the Internal
______________________
/1/ Generally, a "disposition" of shares purchased under an ISO encompasses any
transfer of legal title, such as a transfer by sale, exchange or gift, but does
not include a transfer to your spouse, a transfer into joint ownership with
right of survivorship (if you remain one of the joint owners), a pledge, a
transfer by bequest or inheritance, or certain tax free exchanges permitted
under the Internal Revenue Code.
5
<PAGE>
Revenue Code, then the amount of ordinary income will be equal to the
difference between (a) the fair market value of the Purchased Shares on the
date of vesting and (b) the exercise price. But if the disposition is an
arm's length sale to an unrelated party, the amount of ordinary income will
not exceed the total gain from the sale. Under current IRS rules, the
ordinary income amount will not be subject to withholding for income or
payroll taxes. Your tax basis in the Purchased Shares will be equal to
their fair market value on the date of vesting. Any gain in excess of your
basis will be taxed as a capital gain--either long-term or short-term,
depending on how long you hold the Purchased Shares after the date of
vesting.
. Shares Not Vested--Timely 83(b) Election Filed. If the shares are not
vested at the time of exercise, and if you file a timely election under
section 83(b) of the Internal Revenue Code, then the amount of ordinary
income will be equal to the difference between (a) the fair market value of
the Purchased Shares on the date of exercise and (b) the exercise price. In
other words, the 83(b) election causes the ordinary income to be calculated
as if the shares were vested at the time of exercise. All other rules
described above for the purchase of vested shares by exercising an ISO
apply here as well. You must file an 83(b) election with the Internal
-------------------------------------------------
Revenue Service within 30 days after the Notice of Exercise of Stock Option
---------------------------------------------------------------------------
is signed. The 30-day filing period cannot be extended. Note that, in the
---------
case of an ISO, the 83(b) election does not trigger an immediate tax; it
merely affects how the ordinary income is calculated when you dispose of
the Purchased Shares. If you miss the filing deadline, the amount of your
ordinary income will be based on the value of the Purchased Shares at the
time they vest. (See above.) The form for making the 83(b) election is
attached. Additional copies of the form must be filed with the Company and
with your tax return for the year in which you make the election.
You may not know at this time whether you will dispose of your Purchased Shares
before meeting the two holding periods. You should nevertheless consider filing
an 83(b) election. If you meet the holding periods, the election will be moot
for purposes of the regular tax system, since you will have no ordinary income.
(The effect of the election under the alternative minimum tax system is
discussed below.) If you do not satisfy the holding periods, then the election
will take effect and will limit your ordinary income to the gain that existed at
the time of exercise.
Summary of Alternative Minimum Tax
The alternative minimum tax (AMT) must be paid if it exceeds your regular income
tax. The AMT is equal to 26% of your alternative minimum tax base up to $175,000
and 28% of the excess over $175,000. (In the case of married individuals filing
separately, the breakpoint is $87,500 rather than $175,000.) Your alternative
minimum tax base is equal to your alternative minimum taxable income (AMTI)
minus your exemption amount.
. Alternative Minimum Taxable Income. Your AMTI is equal to your regular
taxable income, subject to certain adjustments and increased by items of
tax preference. Among the many adjustments made in computing AMTI are the
following:
6
<PAGE>
. State and local income and property taxes are not allowed as a deduction.
. Miscellaneous itemized deductions are not allowed.
. Medical expenses are not allowed as a deduction until they exceed 10% of
adjusted gross income (as opposed to the 7.5% floor that applies to regular
income taxes).
. Certain interest deductions are not allowed.
. The standard deduction and personal exemptions are not allowed.
. When an ISO is exercised, the spread is treated as if the option were an
NSO. (See discussion below.)
. Exemption Amount. Before AMT is calculated, AMTI is reduced by the
exemption amount. The exemption amount is as follows:
<TABLE>
------------------------------------------------------------------------------------------------
<S> <C> <C>
Joint Returns: $45,000 Single Returns: $33,750 Separate Returns: $22,500
-------------------------------------------------------------------------------------------------
</TABLE>
The exemption amount is phased out by 25 cents for each $1 by which AMTI
exceeds the following levels:
<TABLE>
-------------------------------------------------------------------------------------------------
<S> <C> <C>
Joint Returns: $150,000 Single Returns: $112,500 Separate Returns: $75,000
-------------------------------------------------------------------------------------------------
</TABLE>
This means, for example, that the entire $45,000 exemption amount
disappears for married individuals filing joint returns when AMTI reaches
$330,000.
Application of AMT When ISO Is Exercised
As noted above, when an ISO is exercised, the spread is treated for AMT purposes
as if the option were an NSO. In other words, the spread is included in AMTI at
the time of exercise, unless the Purchased Shares are not yet vested at the time
of exercise. If the Purchased Shares are not yet vested, the value of the
shares minus the exercise price is included in AMTI when the shares vest. If
you make an election under section 83(b) within 30 days after exercise, then the
spread should be included in AMTI at the time of exercise. You must file an
----------------
83(b) election with the Internal Revenue Service within 30 days after the Notice
- --------------------------------------------------------------------------------
of Exercise of Stock Option is signed. The 30-day filing period cannot be
- -------------------------------------
extended.
A special rule applies if you dispose of the Purchased Shares in the same year
in which you exercised the ISO. If the amount you realize on the sale is less
than the value of the stock at the time of exercise, then the amount includible
in AMTI on account of the ISO exercise is limited to the gain realized on the
sale./2/
___________________
/2/ This is similar to the rule that applies under the regular tax system in
the event of a disqualifying disposition of ISO stock. The amount of ordinary
income that must be recognized in that case generally does not exceed the amount
of the gain realized in the disposition.
7
<PAGE>
To the extent that your AMT is attributable to the spread on exercising an ISO
(and certain other items), the AMT paid may be applied as a credit against your
regular income tax liability in future years. But this tax credit cannot reduce
your regular income tax liability in any future tax year below your AMT for that
year. The AMT credit may be carried forward indefinitely, but it may not be
carried back. (In practice, many optionees who paid AMT upon exercising an ISO
find that they cannot fully use this tax credit for many years, if at all.)
When Purchased Shares are sold, your basis for purposes of computing the capital
gain or loss under the AMT system is increased by the option spread that exists
at the time of exercise. Again, an ISO is treated under the AMT system much like
an NSO is treated under the regular tax system. But your basis in the ISO shares
for purposes of computing gain or loss under the regular tax system is equal to
the exercise price; it does not reflect any AMT that you pay on the spread at
exercise. Therefore, if you pay AMT in the year of the ISO exercise and regular
income tax in the year of selling the Purchased Shares, you could pay tax twice
on the same gain (except to the extent that you can use the AMT credit described
above).
8
<PAGE>
Section 83(b) Election
This statement is made under Section 83(b) of the Internal Revenue Code of 1986,
as amended, pursuant to Treasury Regulations Section 1.83-2.
(1) The taxpayer who performed the services is:
Name: __________________________________________
Address: _______________________________________
_______________________________________
Social Security No.: ___________________________
(2) The property with respect to which the election is made is ______
shares of the common stock of Kendara, Inc.
(3) The property was transferred on ________ __, _____.
(4) The taxable year for which the election is made is the calendar year
_____.
(5) The property is subject to a repurchase right pursuant to which the
issuer has the right to acquire the property at the original purchase
price if for any reason taxpayer's service with the issuer is
terminated. The issuer's repurchase right lapses in a series of
installments over a ______-year period ending on ___________ ____,___.
(6) The fair market value of such property at the time of transfer
(determined without regard to any restriction other than a restriction
which by its terms will never lapse) is $_____ per share.
(7) The amount paid for such property is $_____ per share.
(8) A copy of this statement was furnished to Kendara, Inc., for whom
taxpayer rendered the services underlying the transfer of such
property.
(9) This statement is executed on _______ __, _____.
____________________________ _______________________________________
Signature of Spouse (if any) Signature of Taxpayer
This election must be filed with the Internal Revenue Service Center with which
the Optionee files his or her federal income tax returns and must be filed
within 30 days after the date of purchase. This filing should be made by
registered or certified mail, return receipt requested. The Optionee must retain
two copies of the completed form for filing with his or her federal and state
tax returns for the current tax year and an additional copy for his or her
records.
9
<PAGE>
EXHIBIT 4.06
AT HOME CORPORATION
2000 EQUITY INCENTIVE PLAN
As Adopted January 13, 2000
1. PURPOSE. The purpose of this Plan is to provide incentives to
-------
attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options, Restricted Stock and Stock
Bonuses. Capitalized terms not defined in the text are defined in Section 23.
2. SHARES SUBJECT TO THE PLAN.
--------------------------
2.1 Number of Shares Available. Subject to Sections 2.2 and
--------------------------
18, the total number of Shares reserved and available for grant and issuance
pursuant to this Plan will be 2,000,000 Shares. Subject to Sections 2.2 and 18
hereof, Shares that: (a) are subject to issuance upon exercise of an Option
granted under this Plan that cease to be subject to such Option for any reason
other than exercise of such Option; (b) are subject to an Award granted under
this Plan, that are forfeited or are repurchased by the Company at the original
issue price; or (c) are subject to any other Award granted under this Plan that
otherwise terminates without Shares being issued, will again be available for
grant and issuance in connection with future Awards under this Plan. At all
times the Company shall reserve and keep available a sufficient number of Shares
as shall be required to satisfy the requirements of all outstanding Options
granted under this Plan and all other outstanding but unvested Awards granted
under this Plan.
The sum of (a) Restricted Stock Awards, (b) Stock Bonus Awards,
or (c) Options with a Purchase Price or Exercise Price, as the case may be,
below Fair Market Value issued under this Plan may not exceed 20% of the total
number of Shares reserved for grant and issuance pursuant to this Plan as of any
date.
2.2 Adjustment of Shares. In the event that the number of
--------------------
outstanding Shares is changed by a stock dividend, recapitalization, stock
split, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of the Company without consideration,
then (a) the number of Shares reserved for issuance under this Plan, (b) the
Exercise Prices of and number of Shares subject to outstanding Options, and (c)
the number of Shares subject to other outstanding Awards will be proportionately
adjusted, subject to any required action by the Board or the stockholders of the
Company and compliance with applicable securities laws; provided, however, that
-------- -------
fractions of a Share will not be issued but will either be replaced by a cash
payment equal to the Fair Market Value of such fraction of a Share or will be
rounded up to the nearest whole Share, as determined by the Committee.
3. ELIGIBILITY. Awards may be granted to employees, officers,
-----------
directors, consultants, independent contractors and advisors of the Company or
any Parent or Subsidiary of the Company; provided such consultants, contractors
--------
and advisors render bona fide services not in connection with the offer and sale
of securities in a capital-raising transaction. A person may be granted more
than one Award under this Plan. No more than forty-nine percent (49%) of all
Shares that are reserved for issuance under this Plan may be issued pursuant to
Awards granted to executive vice presidents, senior vice presidents or vice
presidents of the Company.
4. ADMINISTRATION.
--------------
4.1 Committee Authority. This Plan will be administered by
-------------------
the Committee or by the Board acting as the Committee. Subject to the general
purposes, terms and conditions of this Plan, and to the direction of the Board,
the Committee will have full power to implement and carry out this Plan.
Without limitation, the Committee will have the authority to:
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
(a) construe and interpret this Plan, any Award Agreement and any
other agreement or document executed pursuant to this Plan;
(b) prescribe, amend and rescind rules and regulations relating to
this Plan or any Award;
(c) select persons to receive Awards;
(d) determine the form and terms of Awards;
(e) determine the number of Shares or other consideration subject
to Awards;
(f) determine whether Awards will be granted singly, in
combination with, in tandem with, in replacement of, or as
alternatives to, other Awards under this Plan or any other
incentive or compensation plan of the Company or any Parent or
Subsidiary of the Company;
(g) grant waivers of Plan or Award conditions;
(h) determine the vesting, exercisability and payment of Awards;
(i) correct any defect, supply any omission or reconcile any
inconsistency in this Plan, any Award or any Award Agreement;
(j) determine whether an Award has been earned; and
(k) make all other determinations necessary or advisable for the
administration of this Plan.
4.2 Committee Discretion. Any determination made by the
--------------------
Committee with respect to any Award will be made in its sole discretion at the
time of grant of the Award or, unless in contravention of any express term of
this Plan or Award, at any later time, and such determination will be final and
binding on the Company and on all persons having an interest in any Award under
this Plan. The Committee may delegate to one or more officers of the Company
the authority to grant an Award under this Plan to Participants who are not
Insiders of the Company.
5. OPTIONS. Only nonqualified stock options that do not qualify as
-------
incentive stock options within the meaning of Code Section 422(b) may be granted
under this Plan. No more than forty-nine percent (49%) of the total Shares
under this Plan that are made subject to Options may be issued pursuant to
Options granted to executive vice presidents, senior vice presidents or vice
presidents of the Company. The Committee may grant Options to eligible persons
and will determine the number of Shares subject to the Option, the Exercise
Price of the Option, the period during which the Option may be exercised, and
all other terms and conditions of the Option, subject to the following:
5.1 Form of Option Grant. Each Option granted under this Plan
--------------------
will be evidenced by an Award Agreement ("Stock Option Agreement") that will be
in such form and contain such provisions (which need not be the same for each
Participant) as the Committee may from time to time approve, and which will
comply with and be subject to the terms and conditions of this Plan.
5.2 Date of Grant. The date of grant of an Option will be the
-------------
date on which the Committee makes the determination to grant such Option, unless
otherwise specified by the Committee. The Stock Option Agreement and a copy of
this Plan will be delivered to the Participant within a reasonable time after
the granting of the Option.
5.3 Exercise Period. Options may be exercisable within the
---------------
times or upon the events determined by the Committee as set forth in the Stock
Option Agreement governing such Option; provided, however, that no Option will
-------- -------
be exercisable after the expiration of ten (10) years from the date the Option
is granted.
2
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
The Committee also may provide for Options to become exercisable at one time or
from time to time, periodically or otherwise, in such number of Shares or
percentage of Shares as the Committee determines.
5.4 Exercise Price. The Exercise Price of an Option will be
--------------
determined by the Committee when the Option is granted and may be not less than
85% of the Fair Market Value of the Shares on the date of grant. Payment for
the Shares purchased may be made in accordance with Section 8 of this Plan.
5.5 Method of Exercise. Options may be exercised only by
------------------
delivery to the Company of a written stock option exercise agreement (the
"Exercise Agreement") in a form approved by the Committee (which need not be the
same for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding Participant's investment
intent and access to information and other matters, if any, as may be required
or desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price for the number of Shares being
purchased.
5.6 Termination. Notwithstanding the exercise periods set
-----------
forth in the Stock Option Agreement, exercise of an Option will always be
subject to the following:
(a) If the Participant is Terminated for any reason except death or
Disability, then the Participant may exercise such Participant's
Options only to the extent that such Options would have been
exercisable upon the Termination Date no later than three (3)
months after the Termination Date (or such shorter or longer time
period not exceeding five (5) years as may be determined by the
Committee), but in any event, no later than the expiration date
of the Options.
(b) If the Participant is Terminated because of Participant's death
or Disability (or the Participant dies within three (3) months
after a Termination other than because of Participant's death or
Disability), then Participant's Options may be exercised only to
the extent that such Options would have been exercisable by
Participant on the Termination Date and must be exercised by
Participant (or Participant's legal representative or authorized
assignee) no later than twelve (12) months after the Termination
Date (or such shorter or longer time period not exceeding five
(5) years as may be determined by the Committee), but in any
event no later than the expiration date of the Options.
(c) If a Participant is terminated for Cause, then the Participant
may exercise such Participant's Options only to the extent that
such Options would have been exercisable upon the Termination
Date no later than one (1) month after the Termination Date (or
such shorter period as may be determined by the Committee), but
in any event, no later than the expiration date of the Options.
In making such determination, the Board shall give the
Participant an opportunity to present to the Board evidence on
his behalf. For the purpose of this paragraph, termination of
service shall be deemed to occur on the date when the Company
dispatches notice or advice to the Participant that his service
is terminated.
5.7 Limitations on Exercise. The Committee may specify a
-----------------------
reasonable minimum number of Shares that may be purchased on any exercise of an
Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.
5.8 Modification, Extension or Renewal. The Committee may
----------------------------------
modify, extend or renew outstanding Options and authorize the grant of new
Options in substitution therefor, provided that any such action may not, without
the written consent of a Participant, impair any of such Participant's rights
under any Option previously granted. The Committee may reduce the Exercise
Price of outstanding Options without the consent of Participants affected by a
written notice to them; provided, however, that the Exercise Price may not be
-------- -------
reduced below the minimum Exercise Price that would be permitted under Section
5.4 of this Plan for Options granted on the date the action is taken to reduce
the Exercise Price.
3
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
6. RESTRICTED STOCK. A Restricted Stock Award is an offer by the
----------------
Company to sell to an eligible person Shares that are subject to restrictions.
No more than forty-nine percent (49%) of the total Shares under this Plan that
are made subject to Restricted Stock Awards may be issued pursuant to Restricted
Stock Awards granted to executive vice presidents, senior vice presidents or
vice presidents of the Company. The Committee will determine to whom an offer
will be made, the number of Shares the person may purchase, the price to be paid
(the "Purchase Price"), the restrictions to which the Shares will be subject,
and all other terms and conditions of the Restricted Stock Award, subject to the
following:
6.1 Form of Restricted Stock Award. All purchases under a
------------------------------
Restricted Stock Award made pursuant to this Plan will be evidenced by an Award
Agreement ("Restricted Stock Purchase Agreement") that will be in such form
(which need not be the same for each Participant) as the Committee will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The offer of Restricted Stock will be accepted by the
Participant's execution and delivery of the Restricted Stock Purchase Agreement
and full payment for the Shares to the Company within thirty (30) days from the
date the Restricted Stock Purchase Agreement is delivered to the person. If
such person does not execute and deliver the Restricted Stock Purchase Agreement
along with full payment for the Shares to the Company within thirty (30) days,
then the offer will terminate, unless otherwise determined by the Committee.
6.2 Purchase Price. The Purchase Price of Shares sold
--------------
pursuant to a Restricted Stock Award will be determined by the Committee on the
date the Restricted Stock Award is granted and may be less than Fair Market
Value, except in the case of a sale to a to a person who directly or by
attribution owns more than ten percent (10%) of the total combined voting power
of all classes of stock of the Company or of any Parent or Subsidiary of the
Company, in which case the Purchase Price will be 100% of the Fair Market Value.
Payment of the Purchase Price may be made in accordance with Section 8 of this
Plan.
6.3 Terms of Restricted Stock Awards. Restricted Stock Awards
--------------------------------
shall be subject to such restrictions as the Committee may impose. These
restrictions may be based upon completion of a specified number of years of
service with the Company or upon completion of the performance goals as set out
in advance in the Participant's individual Restricted Stock Purchase Agreement.
Restricted Stock Awards may vary from Participant to Participant and between
groups of Participants. Prior to the grant of a Restricted Stock Award, the
Committee shall: (a) determine the nature, length and starting date of any
Performance Period for the Restricted Stock Award; (b) select from among the
Performance Factors to be used to measure performance goals, if any; and (c)
determine the number of Shares that may be awarded to the Participant. Prior to
the payment of any Restricted Stock Award, the Committee shall determine the
extent to which such Restricted Stock Award has been earned. Performance Periods
may overlap and Participants may participate simultaneously with respect to
Restricted Stock Awards that are subject to different Performance Periods and
having different performance goals and other criteria.
6.4 Termination During Performance Period. If a Participant
-------------------------------------
is Terminated during a Performance Period for any reason, then such Participant
will be entitled to payment (whether in Shares, cash or otherwise) with respect
to the Restricted Stock Award only to the extent earned as of the date of
Termination in accordance with the Restricted Stock Purchase Agreement, unless
the Committee will determine otherwise.
7. STOCK BONUSES.
-------------
7.1 Awards of Stock Bonuses. A Stock Bonus is an award of
-----------------------
Shares (which may consist of Restricted Stock) for services rendered to the
Company or any Parent or Subsidiary of the Company. No more than forty-nine
percent (49%) of the total Shares under this Plan that are made subject to Stock
Bonuses may be issued pursuant to Stock Bonuses granted to executive vice
presidents, senior vice presidents or vice presidents of the Company. A Stock
Bonus may be awarded for past services already rendered to the Company, or any
Parent or Subsidiary of the Company pursuant to an Award Agreement (the "Stock
Bonus Agreement") that will be in such form (which need not be the same for each
Participant) as the Committee will from time to time approve, and will comply
with and be subject to the terms and conditions of this Plan. A Stock Bonus may
be awarded upon satisfaction of such performance goals as are set out in advance
in the Participant's individual Award Agreement (the "Performance Stock Bonus
Agreement") that will be in such form (which need not be the same for each
Participant) as the Committee will from time to time approve, and will comply
with and be subject to the terms and
4
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
conditions of this Plan. Stock Bonuses may vary from Participant to Participant
and between groups of Participants, and may be based upon the achievement of the
Company, Parent or Subsidiary and/or individual performance factors or upon such
other criteria as the Committee may determine.
7.2 Terms of Stock Bonuses. The Committee will determine the
----------------------
number of Shares to be awarded to the Participant. If the Stock Bonus is being
earned upon the satisfaction of performance goals pursuant to a Performance
Stock Bonus Agreement, then the Committee will: (a) determine the nature,
length and starting date of any Performance Period for each Stock Bonus; (b)
select from among the Performance Factors to be used to measure the performance,
if any; and (c) determine the number of Shares that may be awarded to the
Participant. Prior to the payment of any Stock Bonus, the Committee shall
determine the extent to which such Stock Bonuses have been earned. Performance
Periods may overlap and Participants may participate simultaneously with respect
to Stock Bonuses that are subject to different Performance Periods and different
performance goals and other criteria. The number of Shares may be fixed or may
vary in accordance with such performance goals and criteria as may be determined
by the Committee. The Committee may adjust the performance goals applicable to
the Stock Bonuses to take into account changes in law and accounting or tax
rules and to make such adjustments as the Committee deems necessary or
appropriate to reflect the impact of extraordinary or unusual items, events or
circumstances to avoid windfalls or hardships.
7.3 Form of Payment. The earned portion of a Stock Bonus may
---------------
be paid currently or on a deferred basis with such interest or dividend
equivalent, if any, as the Committee may determine. Payment may be made in the
form of cash or whole Shares or a combination thereof, either in a lump sum
payment or in installments, all as the Committee will determine.
8. PAYMENT FOR SHARE PURCHASES.
---------------------------
8.1 Payment. Payment for Shares purchased pursuant to this
-------
Plan may be made in cash (by check) or, where expressly approved for the
Participant by the Committee and where permitted by law:
(a) by cancellation of indebtedness of the Company to the
Participant;
(b) by surrender of shares that either: (1) have been owned by
Participant for more than six (6) months and have been paid for
within the meaning of SEC Rule 144 (and, if such shares were
purchased from the Company by use of a promissory note, such note
has been fully paid with respect to such shares); or (2) were
obtained by Participant in the public market;
(c) by tender of a full recourse promissory note having such terms as
may be approved by the Committee and bearing interest at a rate
sufficient to avoid imputation of income under Sections 483 and
1274 of the Code; provided, however, that Participants who are
-------- -------
not employees or directors of the Company will not be entitled to
purchase Shares with a promissory note unless the note is
adequately secured by collateral other than the Shares;
(d) by waiver of compensation due or accrued to the Participant for
services rendered;
(e) with respect only to purchases upon exercise of an Option, and
provided that a public market for the Company's stock exists:
(1) through a "same day sale" commitment from the Participant
and a broker-dealer that is a member of the National
Association of Securities Dealers (an "NASD Dealer")
whereby the Participant irrevocably elects to exercise the
Option and to sell a portion of the Shares so purchased to
pay for the Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward
the Exercise Price directly to the Company; or
5
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
(2) through a "margin" commitment from the Participant and a
NASD Dealer whereby the Participant irrevocably elects to
exercise the Option and to pledge the Shares so purchased
to the NASD Dealer in a margin account as security for a
loan from the NASD Dealer in the amount of the Exercise
Price, and whereby the NASD Dealer irrevocably commits
upon receipt of such Shares to forward the Exercise Price
directly to the Company; or
(f) by any combination of the foregoing.
8.2 Loan Guarantees. The Committee may help the Participant
---------------
pay for Shares purchased under this Plan by authorizing a guarantee by the
Company of a third-party loan to the Participant.
9. WITHHOLDING TAXES.
-----------------
9.1 Withholding Generally. Whenever Shares are to be issued
---------------------
in satisfaction of Awards granted under this Plan, the Company may require the
Participant to remit to the Company an amount sufficient to satisfy federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for such Shares. Whenever, under this Plan, payments
in satisfaction of Awards are to be made in cash, such payment will be net of an
amount sufficient to satisfy federal, state, and local withholding tax
requirements.
9.2 Stock Withholding. When, under applicable tax laws, a
-----------------
Participant incurs tax liability in connection with the exercise or vesting of
any Award that is subject to tax withholding and the Participant is obligated to
pay the Company the amount required to be withheld, the Committee may in its
sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be issued
that number of Shares having a Fair Market Value equal to the minimum amount
required to be withheld, determined on the date that the amount of tax to be
withheld is to be determined. All elections by a Participant to have Shares
withheld for this purpose will be made in accordance with the requirements
established by the Committee and be in writing in a form acceptable to the
Committee
10. PRIVILEGES OF STOCK OWNERSHIP.
-----------------------------
10.1 Voting and Dividends. No Participant will have any of the
--------------------
rights of a stockholder with respect to any Shares until the Shares are issued
to the Participant. After Shares are issued to the Participant, the Participant
will be a stockholder and have all the rights of a stockholder with respect to
such Shares, including the right to vote and receive all dividends or other
distributions made or paid with respect to such Shares; provided, that if such
--------
Shares are Restricted Stock, then any new, additional or different securities
the Participant may become entitled to receive with respect to such Shares by
virtue of a stock dividend, stock split or any other change in the corporate or
capital structure of the Company will be subject to the same restrictions as the
Restricted Stock; provided, further, that the Participant will have no right to
-------- -------
retain such stock dividends or stock distributions with respect to Shares that
are repurchased at the Participant's original Purchase Price pursuant to Section
12.
10.2 Financial Statements. The Company will provide financial
--------------------
statements to each Participant prior to such Participant's purchase of Shares
under this Plan, and to each Participant annually during the period such
Participant has Awards outstanding; provided, however, the Company will not be
-------- -------
required to provide such financial statements to Participants whose services in
connection with the Company assure them access to equivalent information.
11. TRANSFERABILITY. Awards granted under this Plan, and any
---------------
interest therein, will not be transferable or assignable by Participant, and may
not be made subject to execution, attachment or similar process, otherwise than
by will or by the laws of descent and distribution or as determined by the
Committee and set forth in the Award Agreement. During the lifetime of the
Participant an Award will be exercisable only by the Participant, and any
elections with respect to an Award may be made only by the Participant unless
otherwise determined by the Committee and set forth in the Award Agreement.
6
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
12. RESTRICTIONS ON SHARES. At the discretion of the Committee, the
----------------------
Company may reserve to itself and/or its assignee(s) in the Award Agreement a
right to repurchase a portion of or all Unvested Shares held by a Participant
following such Participant's Termination at any time within ninety (90) days
after the later of Participant's Termination Date and the date Participant
purchases Shares under this Plan, for cash and/or cancellation of purchase money
indebtedness, at the Participant's Exercise Price or Purchase Price, as the case
may be.
13. CERTIFICATES. All certificates for Shares or other securities
------------
delivered under this Plan will be subject to such stock transfer orders, legends
and other restrictions as the Committee may deem necessary or advisable,
including restrictions under any applicable federal, state or foreign securities
law, or any rules, regulations and other requirements of the SEC or any stock
exchange or automated quotation system upon which the Shares may be listed or
quoted.
14. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
------------------------
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
-------- -------
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve. The
Shares purchased with the promissory note may be released from the pledge on a
pro rata basis as the promissory note is paid.
15. EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any time or
-----------------------------
from time to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and cancellation
of any or all outstanding Awards. The Committee may at any time buy from a
Participant an Award previously granted with payment in cash, Shares (including
Restricted Stock) or other consideration, based on such terms and conditions as
the Committee and the Participant may agree.
16. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will
----------------------------------------------
not be effective unless such Award is in compliance with all applicable federal
and state securities laws, rules and regulations of any governmental body, and
the requirements of any stock exchange or automated quotation system upon which
the Shares may then be listed or quoted, as they are in effect on the date of
grant of the Award and also on the date of exercise or other issuance.
Notwithstanding any other provision in this Plan, the Company will have no
obligation to issue or deliver certificates for Shares under this Plan prior to:
(a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and/or (b) completion of any registration
or other qualification of such Shares under any state or federal law or ruling
of any governmental body that the Company determines to be necessary or
advisable. The Company will be under no obligation to register the Shares with
the SEC or to effect compliance with the registration, qualification or listing
requirements of any state securities laws, stock exchange or automated quotation
system, and the Company will have no liability for any inability or failure to
do so.
17. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award
-----------------------
granted under this Plan will confer or be deemed to confer on any Participant
any right to continue in the employ of, or to continue any other relationship
with, the Company or any Parent or Subsidiary of the Company or limit in any way
the right of the Company or any Parent or Subsidiary of the Company to terminate
Participant's employment or other relationship at any time, with or without
cause.
18. CORPORATE TRANSACTIONS.
----------------------
7
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
18.1 Assumption or Replacement of Awards by Successor. In the
------------------------------------------------
event of (a) a dissolution or liquidation of the Company, (b) a merger or
consolidation in which the Company is not the surviving corporation (other than
a merger or consolidation with a wholly-owned subsidiary, a reincorporation of
the Company in a different jurisdiction, or other transaction in which there is
no substantial change in the stockholders of the Company or their relative stock
holdings and the Awards granted under this Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on all
Participants), (c) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger
(other than any stockholder that merges, or which owns or controls another
corporation that merges, with the Company in such merger) cease to own their
shares or other equity interest in the Company, (d) the sale of substantially
all of the assets of the Company, or (e) the acquisition, sale, or transfer of
more than 50% of the outstanding shares of the Company by tender offer or
similar transaction, any or all outstanding Awards may be assumed, converted or
replaced by the successor corporation (if any), which assumption, conversion or
replacement will be binding on all Participants. In the alternative, the
successor corporation may substitute equivalent Awards or provide substantially
similar consideration to Participants as was provided to stockholders (after
taking into account the existing provisions of the Awards). The successor
corporation may also issue, in place of outstanding Shares of the Company held
by the Participant, substantially similar shares or other property subject to
repurchase restrictions no less favorable to the Participant. In the event such
successor corporation (if any) refuses to assume or substitute Awards, as
provided above, pursuant to a transaction described in this Subsection 18.1, the
vesting of all Awards will accelerate and the Options will become exercisable in
full prior to the consummation of such event at such times and on such
conditions as the Committee determines, and if such Options are not exercised
prior to the consummation of the corporate transaction, they shall terminate in
accordance with the provisions of this Plan.
18.2 Other Treatment of Awards. Subject to any greater rights
-------------------------
granted to Participants under the foregoing provisions of this Section 18, in
the event of the occurrence of any transaction described in Section 18.1, any
outstanding Awards will be treated as provided in the applicable agreement or
plan of merger, consolidation, dissolution, liquidation, or sale of assets.
18.3 Assumption of Awards by the Company. The Company, from
-----------------------------------
time to time, also may substitute or assume outstanding awards granted by
another company, whether in connection with an acquisition of such other company
or otherwise, by either; (a) granting an Award under this Plan in substitution
of such other company's award; or (b) assuming such award as if it had been
granted under this Plan if the terms of such assumed award could be applied to
an Award granted under this Plan. Such substitution or assumption will be
permissible if the holder of the substituted or assumed award would have been
eligible to be granted an Award under this Plan if the other company had applied
the rules of this Plan to such grant. In the event the Company assumes an award
granted by another company, the terms and conditions of such award will remain
unchanged (except that the exercise price and the number and nature of Shares
------
issuable upon exercise of any such option will be adjusted appropriately
pursuant to Section 424(a) of the Code). In the event the Company elects to
grant a new Option rather than assuming an existing option, such new Option may
be granted with a similarly adjusted Exercise Price.
19. ADOPTION. This Plan became effective on January 13, 2000, the
--------
date on which it was adopted by the Board.
20. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as
--------------------------
provided herein, this Plan will terminate ten (10) years from the date this Plan
is adopted by the Board. This Plan and all agreements hereunder shall be
governed by and construed in accordance with the laws of the State of
California.
21. AMENDMENT OR TERMINATION OF PLAN. The Board may at any time
--------------------------------
terminate or amend this Plan in any respect, including without limitation
amendment of any form of Award Agreement or instrument to be executed pursuant
to this Plan.
22. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by
--------------------------
the Board, the submission of this Plan to the stockholders of the Company for
approval, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements
8
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
as it may deem desirable, including, without limitation, the granting of stock
options and bonuses otherwise than under this Plan, and such arrangements may be
either generally applicable or applicable only in specific cases.
23. DEFINITIONS. As used in this Plan, the following terms will have
-----------
the following meanings:
"Award" means any award under this Plan, including any Option,
Restricted Stock or Stock Bonus.
"Award Agreement" means, with respect to each Award, the signed
written agreement between the Company and the Participant setting forth the
terms and conditions of the Award.
"Board" means the Board of Directors of the Company.
"Cause" means the commission of an act of theft, embezzlement,
fraud, dishonesty or a breach of fiduciary duty to the Company or a Parent or
Subsidiary of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the Compensation Committee of the Board.
"Company" means At Home Corporation or any successor corporation.
"Disability" means a disability, whether temporary or permanent,
partial or total, within the meaning of Section 22(e)(3) of the Code, as
determined by the Committee.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exercise Price" means the price at which a holder of an Option
may purchase the Shares issuable upon exercise of the Option.
"Fair Market Value" means, as of any date, the value of a share
of the Company's Series A Common Stock determined as follows:
(a) if such Series A Common Stock is then quoted on the Nasdaq
National Market, its closing price on the Nasdaq National Market
on the date of determination as reported in The Wall Street
---------------
Journal;
-------
(b) if such Series A Common Stock is publicly traded and is then
listed on a national securities exchange, its closing price on
the date of determination on the principal national securities
exchange on which the Series A Common Stock is listed or admitted
to trading as reported in The Wall Street Journal;
-----------------------
(c) if such Series A Common Stock is publicly traded but is not
quoted on the Nasdaq National Market nor listed or admitted to
trading on a national securities exchange, the average of the
closing bid and asked prices on the date of determination as
reported in The Wall Street Journal; or
-----------------------
(d) if none of the foregoing is applicable, by the Committee in good
faith.
"Insider" means an officer or director of the Company or any
other person whose transactions in the Company's Common Stock are subject to
Section 16 of the Exchange Act.
"Option" means an award of an option to purchase Shares pursuant
to Section 5.
9
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
"Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if each of such
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
"Participant" means a person who receives an Award under this
Plan.
"Performance Factors" means the factors selected by the Committee
from among the following measures to determine whether the performance goals
established by the Committee and applicable to Awards have been satisfied:
(a) Net revenue and/or net revenue growth;
(b) Earnings before income taxes and amortization and/or earnings
before income taxes and amortization growth;
(c) Operating income and/or operating income growth;
(d) Net income and/or net income growth;
(e) Earnings per share and/or earnings per share growth;
(f) Total shareholder return and/or total shareholder return
growth;
(g) Return on equity;
(h) Operating cash flow return on income;
(i) Adjusted operating cash flow return on income;
(j) Economic value added; and
(k) Individual confidential business objectives.
"Performance Period" means the period of service determined by
the Committee, not to exceed five years, during which years of service or
performance is to be measured for Restricted Stock Awards or Stock Bonuses.
"Plan" means this At Home Corporation 1997 Equity Incentive Plan,
as amended from time to time.
"Restricted Stock Award" means an award of Shares pursuant to
Section 6.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means shares of the Company's Series A Common Stock
reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and
18, and any successor security.
"Stock Bonus" means an award of Shares, or cash in lieu of
Shares, pursuant to Section 7.
"Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each of the
corporations other than the last corporation in the unbroken
10
<PAGE>
2000 Equity Incentive Plan
As Adopted January 13, 2000
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in such chain.
"Termination" or "Terminated" means, for purposes of this Plan
with respect to a Participant, that the Participant has for any reason ceased to
provide services as an employee, officer, director, consultant, independent
contractor, or advisor to the Company or a Parent or Subsidiary of the Company.
An employee will not be deemed to have ceased to provide services in the case of
(i) sick leave, (ii) military leave, or (iii) any other leave of absence
approved by the Committee, provided, that such leave is for a period of not more
than 90 days, unless reemployment upon the expiration of such leave is
guaranteed by contract or statute or unless provided otherwise pursuant to
formal policy adopted from time to time by the Company and issued and
promulgated to employees in writing. In the case of any employee on an approved
leave of absence, the Committee may make such provisions respecting suspension
of vesting of the Award while on leave from the employ of the Company or a
Subsidiary as it may deem appropriate, except that in no event may an Option be
exercised after the expiration of the term set forth in the Stock Option
Agreement. The Committee will have sole discretion to determine whether a
Participant has ceased to provide services and the effective date on which the
Participant ceased to provide services (the "Termination Date").
"Unvested Shares" means "Unvested Shares" as defined in the Award
Agreement.
"Vested Shares" means "Vested Shares" as defined in the Award
Agreement.
11
<PAGE>
EXHIBIT 4.07
[LOGO]
AT HOME CORPORATION
2000 EQUITY INCENTIVE PLAN
NOTICE OF STOCK OPTION GRANT
----------------------------
Grant No:
Congratulations! You have been awarded a nonqualified stock option to purchase
At Home Corporation Series A Common Stock, as described below:
Participant:
Social Security Number:
Participant's Address:
Total Option Shares: Exercise Price Per Share:
Date of Grant: Expiration Date:
Full
Shares Vesting Vest Date
------ ------- ---------
Vesting Schedule:
Additional terms and conditions governing this grant are set forth in the Stock
Option Grant Terms And Conditions and in the 2000 Equity Incentive Plan. Both of
these documents are available on the Intranet or by contacting the Stock
Administration Department of Excite@Home, 450 Broadway Street, Redwood City, CA
94063.
<PAGE>
Exhibit 4.08
AT HOME CORPORATION
2000 EQUITY INCENTIVE PLAN
STOCK OPTION GRANT TERMS AND CONDITIONS
---------------------------------------
These Stock Option Grant Terms and Conditions (these "Terms"), together with the
At Home Corporation 2000 Equity Incentive Plan (the "Plan") govern the terms of
the stock option as granted on the Notice of Stock Option Grant (the "Notice").
Capitalized terms not defined herein shall have the meanings ascribed to them in
the Plan.
1. Grant of Option. The Company grants to the participant named on
---------------
the Notice ("Participant") a stock option (the "Option") to purchase up to the
total number of shares of Series A Common Stock of the Company set forth as
Total Option Shares on the Notice (the "Shares") at the Exercise Price Per Share
set forth on the Notice, subject to all of the terms and conditions set forth in
these Terms and the Plan.
2. Vesting; Exercise Period.
------------------------
2.1 Vesting of Right to Exercise Option. The Option shall become
-----------------------------------
exercisable in accordance with the Vesting Schedule set forth on the Notice,
provided that Participant has continuously provided services to the Company or
any Subsidiary or Parent of the Company from the Date of Grant through the date
on which the Shares vest pursuant to the Vesting Schedule.
2.2 Expiration. The Option shall expire on the Expiration Date
----------
set forth on the Notice and must be exercised, if at all, on or before the
earlier of the Expiration Date or the date on which the Option is earlier
terminated in accordance with the provisions of Section 3 below.
3. Termination.
-----------
3.1 Termination for Any Reason Except Death, Disability or Cause.
------------------------------------------------------------
If Participant is Terminated for any reason except Participant's death,
Disability or Cause, then the Option, to the extent (and only to the extent)
that it is exercisable by Participant on the Termination Date, may be exercised
by Participant no later than three (3) months after the Termination Date, but in
any event no later than the Expiration Date.
3.2 Termination Because of Death or Disability. If Participant
------------------------------------------
is Terminated because of death or Disability of Participant (or the Participant
dies within three (3) months after a Termination other than because of
Disability), then the Option, to the extent that it is exercisable by
Participant on the date of Termination, may be exercised by Participant (or
Participant's legal representative) no later than twelve (12) months after the
Termination Date, but in any event no later than the Expiration Date.
3.3 Termination for Cause. If Participant is Terminated for
---------------------
Cause, the Option will expire one month from the date on which the Company
dispatches notice to the Participant that such Participant's service is
Terminated. "Cause" means the commission of an act of theft, embezzlement,
fraud, dishonesty or a breach of fiduciary duty to the Company or a Parent or
Subsidiary of the Company.
<PAGE>
3.4 No Obligation to Employ. Nothing in the Plan, the Notice or
-----------------------
these Terms shall confer on Participant any right to continue in the employ of,
or other relationship with, the Company or any Parent or Subsidiary of the
Company, or limit in any way the right of the Company or any Parent or
Subsidiary of the Company to terminate Participant's employment or other
relationship at any time, with or without Cause.
4. Manner of Exercise.
------------------
4.1 Stock Option Exercise Agreement. To exercise the Option,
-------------------------------
Participant (or in the case of exercise after Participant's death, Participant's
executor, administrator, heir or legatee, as the case may be) must deliver to
the Company an executed stock option exercise agreement in such form as may be
approved by the Company from time to time (the "Exercise Agreement"), which
shall set forth, inter alia, Participant's election to exercise the Option, the
----- ----
number of Shares being purchased, any restrictions imposed on the Shares and any
representations, warranties and agreements regarding Participant's investment
intent and access to information as may be required by the Company to comply
with applicable securities laws. If someone other than Participant exercises
the Option, then such person must submit documentation reasonably acceptable to
the Company that such person has the right to exercise the Option.
4.2 Limitations on Exercise. The Option may not be exercised
-----------------------
unless such exercise is in compliance with all applicable federal and state
securities laws, as they are in effect on the date of exercise. The Option may
not be exercised as to fewer than 100 Shares unless it is exercised as to all
Shares as to which the Option is then exercisable.
4.3 Payment. The Exercise Agreement shall be accompanied by full
-------
payment of the Exercise Price for the Shares being purchased in cash (by check),
or where permitted by law and provided that a public market for the Company's
stock exists: (1) through a "same day sale" commitment from Participant and a
broker-dealer that is a member of the National Association of Securities Dealers
(an "NASD Dealer") whereby Participant irrevocably elects to exercise the Option
and to sell a portion of the Shares so purchased to pay for the Exercise Price
and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
forward the Exercise Price directly to the Company; or (2) through a "margin"
--
commitment from Participant and a NASD Dealer whereby Participant irrevocably
elects to exercise the Option and to pledge the Shares so purchased to the NASD
Dealer in a margin account as security for a loan from the NASD Dealer in the
amount of the Exercise Price, and whereby the NASD Dealer irrevocably commits
upon receipt of such Shares to forward the Exercise Price directly to the
Company.
4.4 Tax Withholding. Prior to the issuance of the Shares upon
---------------
exercise of the Option, Participant must pay or provide for any applicable
federal or state withholding obligations of the Company. If the Committee
permits, Participant may provide for payment of withholding taxes upon exercise
of the Option by requesting that the Company retain Shares with a Fair Market
Value equal to the minimum amount of taxes required to be withheld. In such
case, the Company shall issue the net number of Shares to the Participant by
deducting the Shares retained from the Shares issuable upon exercise.
-2-
<PAGE>
4.5 Issuance of Shares. Provided that the Exercise Agreement and
------------------
payment are in form and substance satisfactory to counsel for the Company, the
Company shall issue the Shares registered in the name of Participant,
Participant's authorized assignee, or Participant's legal representative, and,
if applicable, shall deliver certificates representing the Shares with the
appropriate legends affixed thereto.
5. Compliance with Laws and Regulations. The exercise of the Option
------------------------------------
and the issuance and transfer of Shares shall be subject to compliance by the
Company and Participant with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange on
which the Company's Common Stock may be listed at the time of such issuance or
transfer. Participant understands that the Company is under no obligation to
register or qualify the Shares with the Securities and Exchange Commission, any
state securities commission or any stock exchange to effect such compliance.
6. Nontransferability of Option. Unless otherwise permitted by the
----------------------------
Committee in accordance with the Plan, the Option may not be transferred in any
manner other than by will or by the laws of descent and distribution and may be
exercised during the lifetime of Participant only by Participant. The terms of
the Option shall be binding upon the executors, administrators, successors and
assigns of Participant.
7. Tax Consequences. Set forth below is a brief summary as of the
----------------
date the Board of Directors of the Company adopted the Plan of some of the
federal and California tax consequences of exercise of the Option and
disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX
LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. PARTICIPANT SHOULD CONSULT A TAX
ADVISOR BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES.
7.1 Exercise of Nonqualified Stock Option. There may be a
-------------------------------------
regular federal and California income tax liability upon the exercise of the
Option. Participant will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the fair
market value of the Shares on the date of exercise over the Exercise Price. The
Company will be required to withhold from Participant's compensation or collect
from Participant and pay to the applicable taxing authorities an amount equal to
a percentage of this compensation income at the time of exercise.
7.2 Disposition of Shares. If the Shares are held for more than
---------------------
twelve (12) months after the date of the transfer of the Shares pursuant to the
exercise of the Option, then any gain realized on disposition of the Shares will
be treated as long term capital gain for federal and California income tax
purposes.
8. Privileges of Stock Ownership. Participant shall not have any of
-----------------------------
the rights of a shareholder with respect to any Shares until Participant
exercises the Option and pays the Exercise Price.
9. Interpretation. Any dispute regarding the interpretation of the
--------------
Option shall be submitted by Participant or the Company to the Committee for
review. The resolution of such a dispute by the Committee shall be final and
binding on the Company and Participant.
-3-
<PAGE>
10. Entire Option. The Plan is incorporated herein by reference. The
-------------
Notice, these Terms, the Plan and the Exercise Agreement constitute the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof and supersede all prior understandings and agreements with respect
to such subject matter.
11. Notices. Any notice required to be given or delivered to the
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Company under the terms of the Option shall be in writing and addressed to the
Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Participant shall be in writing and
addressed to Participant at the address indicated on the Notice or to such other
address as such party may designate in writing from time to time to the Company.
All notices shall be deemed to have been given or delivered upon: personal
delivery; three (3) days after deposit in the United States mail by certified or
registered mail (return receipt requested); one (1) business day after deposit
with any return receipt express courier (prepaid); or one (1) business day after
transmission by facsimile.
12. Successors and Assigns. The Company may assign any of its rights
----------------------
under the Option. The Option shall be binding upon and inure to the benefit of
the successors and assigns of the Company. Subject to the restrictions on
transfer set forth herein, the Option shall be binding upon Participant and
Participant's heirs, executors, administrators, legal representatives,
successors and assigns.
13. Governing Law. The Option shall be governed by and construed in
-------------
accordance with the internal laws of the State of California, without regard to
that body of law pertaining to choice of law or conflict of law.
-4-
<PAGE>
EXHIBIT 4.09
EXCITE@HOME
STOCK OPTION EXERCISE NOTICE AND AGREEMENT
- ------------------------------------------------------------------------------
Instructions: Login to Options Online to see vested shares. Call your
broker to place your sell order. Complete and sign this Agreement and
fax to Stock Administration at 650-569-5045, or deliver to 440
Broadway, 4th Floor, Redwood City, CA 94063. Call 650-556-6548 or 650-
556-5335 with questions.
- ------------------------------------------------------------------------------
I hereby elect to purchase the number of shares of Series A Common Stock of AT
HOME CORPORATION the "Company") as set forth below:
Name: _________________________ Other Broker:______________________
Address: __________________________ Contact name:______________________
__________________________ Contact Phone Number:______________
----- Account Number:____________________
Broker:----- Merrill Lynch
----- PaineWebber
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Option Option Option Shares Option
Number Date Type ** Exercised Price
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
** FOR U.S. TAXPAYERS, THE IRS REQUIRES TAX WITHHOLDING ON THE EXERCISE OF A
"NQ" OR NON-QUALIFIED OPTION OPTION (28% FEDERAL, APPLICABLE STATE & LOCAL, 6.2%
SOCIAL SECURITY to the yearly maximum & 1.45% MEDICARE).
Delivery of Purchase Price. Participant hereby delivers to the Company the
Purchase Price, to the extent permitted in the Option Agreement (the "Option
Agreement") as follows (check as applicable and complete):
[_____] in cash (by check) in the amount of $_________________, receipt of
which is acknowledged by the Company
[_____] through a "same-day-sale" commitment, from Participant and the Broker
named above, or;
[_____] through a "margin" commitment, from Participant and the Broker named
above.
Tax Consequences. PARTICIPANT UNDERSTANDS THAT PARTICIPANT MAY SUFFER ADVERSE
TAX CONSEQUENCES AS A RESULT OF PARTICIPANT'S PURCHASE OR DISPOSITION OF THE
SHARES. PARTICIPANT REPRESENTS THAT PARTICIPANT HAS CONSULTED WITH ANY TAX
CONSULTANT(S) PARTICIPANT DEEMS ADVISABLE IN CONNECTION WITH THE PURCHASE OR
DISPOSITION OF THE SHARES AND THAT PARTICIPANT IS NOT RELYING ON THE COMPANY FOR
ANY TAX ADVISE.
Entire Agreement. The Plan and Option Agreement are incorporated herein by
reference, and participant hereby acknowledges receipt thereof. This Exercise
Agreement, the Plan and the Option Agreement constitute the entire agreement and
understanding of the parties and supercede in their entirety all prior
understandings and agreements of the Company and Participant with respect to the
subject matter hereof, and are governed by California law except for that body
of law pertaining to choice of law or conflict of law.
Duplicate Trades. Participant understands that if they place a sell order for
the same block of shares with more than one broker and both orders are executed,
that both transactions will be cancelled and participant will be held solely
responsible for any brokerage charges, bank fees, interest and any and all costs
associated with the cancellation of the orders.
Signature of Participant Date
<PAGE>
EXHIBIT 5.01
------------
March 2, 2000
At Home Corporation
450 Broadway Road
Redwood City, CA 94063
Gentlemen/Ladies:
At your request, we have examined the Registration Statement on Form S-8
(the "Registration Statement") filed by you with the Securities and Exchange
Commission (the "Commission") on or about March 2, 2000 in connection with the
registration under the Securities Act of 1933, as amended, of:
(1) an aggregate of 194,573 shares of your Series A Common Stock, $0.01
par value per share (the "Stock") which are issuable upon the exercise
of options originally granted by Kendara, Inc., a Delaware
corporation, that have been assumed by you and converted into options
to purchase shares of Stock (the "Assumed Options") pursuant to the
Agreement and Plan of Reorganization, dated as of February 2, 2000, by
and among you, Grisham Acquisition Corporation, Kendara, Inc. and the
representative of the stockholders of Kendara, Inc. (the "Plan of
Reorganization"); and
(2) an aggregate of 2,000,000 shares of your Stock which are issuable upon
the exercise of stock options, stock bonuses or restricted stock
awards to be granted by you under your 2000 Equity Incentive Plan; and
(3) an aggregate of 541,545 shares of your Stock which are issuable upon
the exercise of options granted in connection with the earnout
provisions of the BMA Plan of Reorganization (as defined below) which
options are in addition to those originally granted by Hartford House,
Ltd., a Delaware corporation, that have been assumed by you and
converted into options to purchase shares of Stock (the "Additional
Earnout Options") pursuant to the Agreement and Plan of
Reorganization, dated as of October 23, 1999, by and among you and
Hartford House, Ltd. (the "BMA Plan of Reorganization").
In rendering this opinion, we have examined the following:
(1) the Registration Statement, together with the Exhibits filed as a part
thereof;
(2) the prospectuses prepared in connection with the Registration
Statement;
(3) the Plan of Reorganization and the BMA Plan of Reorganization;
<PAGE>
(4) your Fifth Amended and Restated Certificate of Incorporation filed
with the Delaware Secretary of State on May 28, 1999 and your Second
Amended and Restated Bylaws;
(5) the minutes of meetings and actions by written consent of your
stockholders and Board of Directors that are contained in your minute
books that are in our possession;
(6) a certificate from your transfer agent dated of even date herewith,
verifying the number of your issued and outstanding shares of capital
stock as of the date hereof, and a list of option and warrant holders
respecting your capital stock and of any rights to purchase capital
stock that was prepared by you dated of even date herewith verifying
the number of such issued and outstanding securities; and
(7) a Management Certificate addressed to us and dated of even date
herewith executed by you containing certain factual and other
representations.
In our examination of documents for purposes of this opinion, we have
assumed, and express no opinion as to, the genuineness of all signatures on
original documents, the authenticity of all documents submitted to us as
originals, the conformity to originals of all documents submitted to us as
copies, the legal capacity of all persons executing the same, the lack of any
undisclosed termination, modification, waiver or amendment to any document
reviewed by us and the due authorization, execution and delivery of all
documents where due authorization, execution and delivery are prerequisites to
the effectiveness thereof.
As to matters of fact relevant to this opinion, we have relied solely upon
our examination of the documents referred to above and have assumed the current
accuracy and completeness of the information obtained from records and documents
referred to above. We have made no independent investigation or other attempt
to verify the accuracy of any of such information or to determine the existence
or non-existence of any other factual matters; however, we are not aware of any
-------
facts that would cause us to believe that the opinion expressed herein is not
accurate.
We are admitted to practice law in the State of California, and we render
this opinion only with respect to, and express no opinion herein with concerning
the application or effect of the laws of any jurisdiction other than, the
existing laws of the United States of America and the State of California and
the existing Delaware General Corporation Law.
Based upon the foregoing, it is our opinion that the 194,573 shares of
Stock that may be issued and sold by you pursuant to the exercise of Assumed
Options, the 2,000,000 that may be issued and sold by the Company upon the
exercise of stock options, stock bonuses or restricted stock awards granted or
to be granted under the 2000 Equity Incentive Plan, and the 541,545 shares of
Stock that may be issued and sold by you pursuant to the exercise of Additional
Earnout Options, when issued, sold and delivered in accordance with the
applicable plan and purchase agreements to be entered into thereunder and in the
manner and for the consideration stated in the Registration Statement and the
relevant Prospectus, will be validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to all references to us, if any, in the
Registration Statement, the Prospectus
2
<PAGE>
constituting a part thereof and any amendments thereto. This opinion speaks only
as of its date and we assume no obligation to update this opinion should
circumstances change after the date hereof. This opinion is intended solely for
use in connection with issuance and sale of shares in subject to the
Registration Statement and is not to be relied upon for any other purpose.
Very truly yours,
FENWICK & WEST LLP
By: /s/ Jeffrey R. Vetter
----------------------------
Jeffrey R. Vetter, a Partner
3
<PAGE>
Exhibit 23.01
-------------
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement on
Form S-8 of At Home Corporation pertaining to the Kendara, Inc. 1999 Stock Plan
and the 2000 Equity Incentive Plan, of our report dated January 19, 1999, with
respect to the consolidated financial statements of At Home Corporation,
included in its Annual Report on Form 10-K/A for the year ended December 31,
1998 filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Walnut Creek, California
February 28, 2000
<PAGE>
Exhibit 23.02
-------------
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statements on Form S-8 of At Home Corporation, filed with the SEC on or about
March 2, 2000 of our report dated April 23, 1998 relating to the financial
statements of Narrative Communication Corp., which appears in Exhibit 99.01 of
the current Report on Form 8-K/A of At Home Corporation filed with the SEC on
January 14, 1999 (as amended on Form 8-K/A on February 19, 1999).
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
February 28, 2000
