<PAGE>
As filed with the Securities and Exchange Commission on October 22, 1999
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
______________________
INKTOMI CORPORATION
(Exact name of Registrant as specified in its charter)
______________________
Delaware 94-3238130
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
4100 E. Third Avenue
Foster City, CA 94404
(Address, Including zip code, of Registrant's principal executive offices)
______________________
WebSpective Software, Inc. (formerly Atreve Software, Inc.)
1997 Stock Option Plan
(Full title of the plan)
______________________
TIMOTHY STEVENS
Vice President of Corporate and Legal Affairs and
General Counsel
4100 E. Third Avenue
Foster City, CA 94404
(650) 653-2800
(Name, address, and telephone number, including area code, of agent for service)
______________________
Copies to:
DOUGLAS H. COLLOM, ESQ.
Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304
(415) 493-9300
______________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Proposed Maximum Proposed Maximum
Title of Each Class of Securities Amount to be Offering Price Aggregate Offering Amount of
to be Registered Registered Per Share Price Registration Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.001 per share par value: To 37,321 shares $25.30 (1) $944,222(1) $263
be issued under WebSpective Software, Inc.
Stock Plan...............................
====================================================================================================================================
</TABLE>
(1) Estimated in accordance with Rule 457(h) solely for the purpose of
computing the amount of the registration fee based on the weighted average
exercise price of $25.30 per share covering authorized but unissued shares
under the WebSpective Software, Inc. Stock Plan.
================================================================================
<PAGE>
PART II: INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
---------------------------------------
Inktomi Corporation hereby incorporates by reference in this registration
statement the following documents:
1. Inktomi's Annual Report on Form 10-K for the fiscal year ended
September 30, 1998;
2. Inktomi's Quarterly Report on Form 10-Q for the quarter ended
June 30,1999;
3. Inktomi's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1999;
4. Inktomi's Quarterly Report on Form 10-Q for the quarter ended
December 31, 1998;
5. Inktomi's Current Report on Form 8-K dated October 15, 1999 relating
to the acquisition of WebSpective Software, Inc.;
6. Inktomi's Current Report on Form 8-K dated May 13, 1999 relating to
the acquisition of Impulse Buy Network, Inc.;
7. Inktomi's Current Report on Form 8-K dated December 29, 1998 relating
to Inktomi's stock split;
8. Inktomi's Current Report on Form 8-K dated November 6, 1998 relating
to Inktomi's acquisition of C2B Technologies, Inc.;
9. Inktomi's Current Report on Form 8-K dated October 9, 1998, as amended
November 2, 1998, relating to the acquisition of C2B Technologies,
Inc.; and
10. The description of Inktomi's common stock contained in its
Registration Statement on Form 8-A as filed with the SEC on May 22,
1998.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended, prior to
the filing of a post-effective amendment to this registration statement which
indicates that all securities offered hereby have been sold or which deregisters
all securities remaining unsold, shall be deemed to be incorporated by reference
in this registration statement and to be a part hereof from the date of filing
of such documents.
Item 4. Description of Securities
-------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel
--------------------------------------
The validity of the shares of common stock offered hereby has been passed
upon for Inktomi by Wilson Sonsini Goodrich & Rosati, Professional Corporation,
Palo Alto, California. As of the date of this prospectus, attorneys who are
members of or are employed by Wilson Sonsini Goodrich & Rosati and participating
in matters on behalf of Inktomi relating to this Registration Statement,
beneficially own an aggregate of 4,235 shares of Inktomi's Common Stock.
II-1
<PAGE>
Item 6. Indemnification of Directors and Officers
-----------------------------------------
Section 145 of the Delaware General Corporation Law permits a corporation
to include in its charter documents and in agreements between the corporation
and its directors and officers, provisions expanding the scope of
indemnification beyond that specifically provided by the current law.
Article X of Inktomi's Amended and Restated Certificate of Incorporation
provides for the indemnification of directors to the fullest extent permitted
under Delaware law.
Article VI of Inktomi's Bylaws provides for the indemnification of
officers, directors and third parties acting on behalf of the corporation to the
fullest extent permitted under the General Corporation Law of Delaware.
Inktomi has entered into indemnification agreements with its directors and
executive officers, in addition to indemnification provided for in Inktomi's
Bylaws, and intends to enter into indemnification agreements with any new
directors and executive officers in the future.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, or persons controlling Inktomi pursuant
to the foregoing provisions, Inktomi has been informed that in the opinion of
the SEC such indemnification is against public policy as expressed in the
Securities Act and is therefore unenforceable.
At present, there is no pending litigation or proceeding involving a
director, officer, employee, or other agent of Inktomi in which indemnification
is being sought, nor is Inktomi aware of any threatened litigation that may
result in a claim for indemnification by any director, officer, employee, or
other agent of Inktomi.
Item 7. Exemption From Registration Claimed
-----------------------------------
Not applicable.
Item 8. Exhibits
--------
Exhibit
Number Documents
------- ------------------------------------------------------------
4.1 WebSpective Software, Inc. (formerly Atreve Software, Inc.)
1997 Stock Option Plan and form of agreement thereunder
5.1 Opinion of counsel as to legality of securities being
registered
23.1 Consent of Counsel (contained in Exhibit 5.1)
23.2 Consent of Independent Auditors
24.1 Power of Attorney (see page II-5)
Item 9. Undertakings
------------
(a) Rule 415 offering
The undersigned registrant hereby undertakes:
II-2
<PAGE>
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement 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;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended, 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.
(b) Filing incorporating subsequent Exchange Act documents by reference
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, 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.
(c) Request for acceleration of effective date or filing of registration
statement on Form S-8
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 foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange 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, 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.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
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 the City of Foster City, State of California, on this 21/st/ day
of October, 1999.
INKTOMI CORPORATION
By: /s/ JERRY M. KENNELLY
--------------------------------------
Jerry M. Kennelly, Vice President of
Finance and Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints David C. Peterschmidt and Jerry M.
Kennelly, and each of them, as his or her attorney-in-fact, with full power of
substitution in each, for him or her in any and all capacities, to sign any
amendments to this Registration Statement on Form S-8 and to file the same, with
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
each of said attorneys-in-fact, or his substitute or substitutes, may 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>
/s/ DAVID C. PETERSCHMIDT President, Chief Executive Officer and October 21, 1999
- ----------------------------------------- Chairman (Principal Executive Officer)
David C. Peterschmidt
/s/ JERRY M. KENNELLY Vice President of Finance and Chief October 21, 1999
- ----------------------------------------- Financial Officer (Principal Financial
Jerry M. Kennelly and Accounting Officer)
/s/ ERIC A. BREWER Director October 21, 1999
- -----------------------------------------
Eric A. Brewer
/s/ FRANK GILL Director October 21, 1999
- -----------------------------------------
Frank Gill
/s/ FREDRIC W. HARMAN Director October 21, 1999
- -----------------------------------------
Fredric W. Harman
/s/ JOHN A. PORTER Director October 21, 1999
- -----------------------------------------
John A. Porter
/s/ ALAN F. SHUGART Director October 21, 1999
- -----------------------------------------
Alan F. Shugart
</TABLE>
II-4
<PAGE>
INKTOMI CORPORATION
REGISTRATION STATEMENT ON FORM S-8
----------------------------------
INDEX TO EXHIBITS
Exhibit
Number Documents
- ------------ ---------------------------------------------------------------
4.1 WebSpective Software, Inc. (formerly Atreve Software, Inc.)
1997 Stock Option Plan and form of agreement thereunder
5.1 Opinion of counsel as to legality of securities being
registered
23.1 Consent of Counsel (contained in Exhibit 5.1)
23.2 Consent of Independent Auditors
24.1 Power of Attorney (see page II-5)
II-5
<PAGE>
ATREVE SOFTWARE, INC.
1997 STOCK OPTION PLAN
(AS AMENDED AND RESTATED ON APRIL 9, 1998)
1. Purpose of the Plan.
-------------------
This stock option plan (the "Plan") is intended to provide incentives: (a)
to the officers and other employees of Atreve Software, Inc., a Delaware
corporation (the "Company"), and any present or future subsidiaries of the
Company (collectively, "Related Corporations"), by providing them with
opportunities to purchase stock in the Company pursuant to options granted
hereunder which qualify as "incentive stock options" under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code") ("ISO" or "ISOs"); and
(b) to officers, employees, consultants and directors of the Company and any
present or future Related Corporations by providing them with opportunities to
purchase stock in the Company pursuant to options granted hereunder which do not
qualify as ISOs ("Non-Qualified Option" or "Non-Qualified Options"). As used
herein, the terms "parent" and "subsidiary" mean "parent corporation" and
"subsidiary corporation," respectively, as those terms are defined in Section
424 of the Code and the Treasury Regulations promulgated thereunder (the
"Regulations").
2. Stock Subject to the Plan.
-------------------------
(a) The total number of shares of the authorized but unissued shares of the
common stock, par value $.01 per share ("Common Stock"), of the Company for
which options may be granted under the Plan shall not exceed 2,351,667 shares,
subject to adjustment as provided in Section 11 hereof.
(b) If an option granted hereunder shall expire or terminate for any reason
without having been exercised in full, the unpurchased shares subject thereto
shall again be available for subsequent option grants under the Plan.
(c) Stock issuable or issued upon exercise of an option granted under the
Plan may be subject to such restrictions on transfer, repurchase rights or other
restrictions as shall be determined by the Committee (as defined in Section 3
below).
3. Administration of the Plan.
--------------------------
The Plan shall be administered by the Company's Board of Directors (the
"Board") or by a committee of the Board (the "Committee") consisting of two or
more members of the Board, to whom the Board may (except as provided in Section
4 hereof) delegate its authority hereunder. Hereinafter, all references in this
Plan to the "Committee" shall mean the Board if no committee has been appointed.
The decisions of the Board or the Committee as to all questions of
interpretation and application of the Plan shall be final, binding and
conclusive on all persons. The Board or the Committee shall have the authority
to adopt, amend and rescind such rules and
<PAGE>
regulations as, in its opinion, may be advisable in the administration of the
Plan. The Board or the Committee may correct any defect or supply any omission
or reconcile any inconsistency in the Plan or in any option agreement granted
hereunder in the manner and to the extent it shall deem expedient to carry the
Plan into effect and shall be the sole and final judge of such expediency. No
Board or Committee member shall be liable for any action or determination made
in good faith.
If any such Committee is appointed, the Board may from time to time appoint
a member or members of the Committee in substitution for or in addition to the
member or members then in office and may fill vacancies on the Committee however
caused. The Committee shall chose one of its members as Chairman and shall hold
meetings at such times and places as it shall deem advisable. A majority of the
members of the Committee shall constitute a quorum and any action may be taken
by a majority of those present and voting at any meeting. Any action may also
be taken without the necessity of a meeting by a written instrument signed by
all members of the Committee.
With respect to the participation of any officer or director in the Plan,
his or her selection as an optionee, the number of option shares to be allocated
to such officer or director, the exercise price and vesting of the options, and
all other terms and conditions of such options, shall be determined by, or only
in accordance with, the recommendations of the Committee. The provisions of the
preceding sentence of this Section 3 shall not apply with respect to any option
granted prior to the date of the first registration of an equity security of the
Company under Section 12 of the Securities Exchange Act of 1934 (the "Exchange
Act").
4. Eligibility.
-----------
(a) Options designated as ISOs may be granted only to officers and other
employees of the Company or a Related Corporation. Non-Qualified Options may be
granted to any director, officer, employee, or consultant of the Company or a
Related Corporation.
(b) In determining the eligibility of an individual to be granted an
option, as well as in determining the number of shares to be optioned to any
individual, the Committee shall take into account such factors as the Committee
may deem relevant.
(c) No option designated as an ISO shall be granted to any employee of the
Company or a Related Corporation if such employee owns, immediately prior to the
grant of an option, stock representing more than 10% of the voting power or more
than 10% of the value of all classes of stock of the Company or a parent or a
subsidiary, unless the purchase price for the stock under such option shall be
at least 110% of its fair market value at the time such option is granted and
the option, by its terms, shall not be exercisable more than five years from the
date it is granted. In determining the stock ownership under this paragraph,
the provisions of Section 424(d) of the Code shall be controlling. In
determining the fair market value under this paragraph, the provisions of
Section 6 hereof shall apply.
2
<PAGE>
The maximum number of shares of the Company's Common Stock with respect to
which an option or options may be granted to any employee in any one taxable
year of the Company shall not exceed 2,000,000 shares, taking into account
shares granted during such taxable year under options that are terminated, and
subject to adjustment under Section 11 hereof.
5. Option Agreement.
----------------
Each option shall be evidenced by an option agreement (the "Agreement") duly
executed on behalf of the Company and by the optionee to whom such option is
granted, which Agreement shall comply with and be subject to the terms and
conditions of the Plan. The Agreement may contain such other terms, provisions
and conditions which are not inconsistent with the Plan as may be determined by
the Committee, provided that options designated as ISOs shall meet all of the
conditions for ISOs as defined in Section 422 of the Code. The date of grant of
an option shall be as determined by the Committee. More than one option may be
granted to an individual.
6. Exercise Price.
--------------
The exercise price or prices of shares of the Company's Common Stock for
options designated as Non-Qualified Options shall be as determined by the
Committee, but in no event shall the exercise price be less than the minimum
legal consideration required therefor under the General Corporation Law of the
State of Delaware or the laws of any jurisdiction in which the Company or its
successors in interest may be organized. Subject to Section 4(c) above, the
exercise price or prices of shares of the Company's Common Stock for ISOs shall
be not less than the fair market value of such Common Stock at the time the
option is granted as determined by the Board in accordance with the Regulations
promulgated under Section 422 of the Code. If such shares are then listed on
any national securities exchange, the fair market value shall be the mean
between the high and low sales prices, if any, on such exchange on the business
day immediately preceding the date of the grant of the option or, if none, shall
be determined by taking a weighted average of the means between the highest and
lowest sales prices on the nearest date before and the nearest date after the
date of grant in accordance with Treasury Regulations Section 25.2512-2. If the
shares are not then listed on any such exchange, the fair market value of such
shares shall be the mean between the high and low sales prices, if any, as
reported in the National Association of Securities Dealers Automated Quotation
System National Market System ("NASDAQ/NMS") for the business day immediately
preceding the date of the grant of the option, or, if not so reported, shall be
determined by taking a weighted average of the means between the highest and
lowest sales on the nearest date before and the nearest date after the date of
grant in accordance with Treasury Regulations Section 25.2512-2. If the shares
are not then either listed on any such exchange or quoted in NASDAQ/NMS, the
fair market value shall be the mean between the average of the "Bid" and the
average of the "Ask" prices, if any, as reported in the National Daily Quotation
Service for the business day immediately preceding the date of the grant of the
option, or, if none, shall be determined by taking a weighted average of the
means between the highest and lowest sales prices on the nearest date before and
the nearest date after the date of grant in accordance with Treasury Regulations
Section 25.2512-2. If the fair market value cannot be determined under the
preceding three sentences, it shall be determined in good faith by the Board.
3
<PAGE>
7. Manner of Payment; Manner of Exercise.
-------------------------------------
(a) Options granted under the Plan may provide for the payment of the
exercise price as set forth in the Agreement or by delivery of (i) cash or a
check payable to the order of the Company in an amount equal to the exercise
price of such options, (ii) if the Agreement with respect to the option so
specifies, by delivery of the optionee's personal recourse promissory note,
which promissory note shall comply with the provisions of Section 16 of this
Plan, (iii) shares of Common Stock of the Company owned by the optionee having a
fair market value equal in amount to the exercise price of the options being
exercised, or (iv) any combination of (i), (ii) and (iii); provided, however,
-------- -------
that payment of the exercise price by delivery of shares of Common Stock of the
Company owned by such optionee may be made only if such shares have been
beneficially owned by the optionee, free and clear of any risk of forfeiture,
for a period of at least six (6) months prior to the time of such payment;
provided, further, however, that any such payment shall be made only under such
- -------- -------- --------
circumstances and on such terms as may from time to time be established by the
Board. The fair market value of any shares of the Company's Common Stock which
may be delivered upon exercise of an option shall be determined by the Board in
accordance with Section 6 hereof. With the consent of the Board, payment may
also be made by delivery of a properly executed exercise notice to the Company,
together with a copy of irrevocable instruments to a broker to deliver promptly
to the Company the amount of sale or loan proceeds to pay the exercise price.
To facilitate the foregoing, the Company may enter into agreements for
coordinated procedures with one or more brokerage firms.
(b) To the extent that the right to purchase shares under an option has
accrued and is in effect, options may be exercised in full at one time or in
part from time to time, by giving written notice, signed by the person or
persons exercising the option, to the Company, stating the number of shares with
respect to which the option is being exercised, accompanied by payment in full
for such shares as provided in subparagraph (a) above. Upon such exercise,
delivery of a certificate for fully paid non-assessable shares shall be made at
the principal office of the Company to the person or persons exercising the
option at such time, during ordinary business hours, promptly following receipt
of the notice by the Company, as shall be designated in such notice, or at such
time, place and manner as may be agreed upon by the Company and the person or
persons exercising the option.
8. Exercise of Options.
-------------------
Subject to the provisions of paragraphs 9 through 11, each option granted
under the Plan shall be exercisable as follows:
(a) Vesting. The option shall either be fully exercisable on the date of
-------
grant or shall become exercisable thereafter in such installments as provided
for in the Option Agreement executed pursuant to Section 5 hereof.
4
<PAGE>
(b) Full Vesting of Installments. Once an installment becomes exercisable
----------------------------
it shall remain exercisable until expiration or termination of the option,
unless otherwise specified by the Committee.
(c) Partial Exercise. Each option or installment may be exercised at any
----------------
time or from time to time, in whole or in part, for up to the total number of
shares with respect to which it is then exercisable.
(d) Acceleration of Vesting. The Committee shall have the right to
-----------------------
accelerate the date of exercise of any installment of any option; provided,
--------
however, that the Committee shall not, without the consent of an optionee,
- -------
accelerate the exercise date of any installment of any option granted to any
employee as an ISO if such acceleration would violate the annual vesting
limitation contained in Section 422(d) of the Code.
9. Term of Options; Exercisability.
-------------------------------
(a) Term. Subject to Section 4(c) above, each option shall expire not more
----
than ten (10) years from the date of the granting thereof, but shall be subject
to earlier termination as may be provided in the Agreement.
(b) Exercisability. Except as otherwise provided in the Agreement, an
--------------
option granted to an employee optionee who ceases to be an employee of the
Company or a Related Corporation shall be exercisable only to the extent that
the right to purchase shares under such option has accrued and is in effect on
the date such optionee ceases to be an employee of the Company or such Related
Corporation.
10. Options Not Transferable. The right of any optionee to exercise any
------------------------
option granted to him or her shall not be assignable or transferable by such
optionee otherwise than by will or the laws of descent and distribution, or the
rules thereunder, and any such option shall be exercisable during the lifetime
of such optionee only by him or her. Any option granted under the Plan shall be
null and void and without effect upon the bankruptcy of the optionee to whom the
option is granted, or upon any attempted assignment or transfer, except as
herein provided, including without limitation any purported assignment, whether
voluntary or by operation of law, pledge, hypothecation or other disposition,
attachment, divorce, trustee process or similar process, whether legal or
equitable, upon such option.
11. Adjustments. Upon the occurrence of any of the following events, an
-----------
optionee's rights with respect to options granted to him or her hereunder shall
be adjusted as hereinafter provided, unless otherwise specifically provided in
the written agreement between the optionee and the Company relating to such
option:
(a) Stock Dividends and Stock Splits. If the shares of Common Stock shall
--------------------------------
be subdivided or combined into a greater or smaller number of shares or if the
Company shall issue any shares of Common Stock as a stock dividend on its
outstanding Common Stock, the number of shares of Common Stock deliverable upon
the exercise of options shall be appropriately
5
<PAGE>
increased or decreased proportionately, and appropriate adjustments shall be
made in the purchase price per share to reflect such subdivision, combination or
stock dividend.
(b) Consolidations or Mergers. In connection with, and prior to the
-------------------------
consummation of, a C/M Transaction (as defined below), the Committee or the
board of directors of any entity assuming the obligations of the Company
hereunder (the "Successor Board"), shall, as to outstanding options, make
appropriate provision for the continuation of such options by substituting on an
equitable basis for the shares then subject to such options the consideration
payable with respect to the outstanding shares of Common Stock in connection
with the C/M Transaction. For purposes hereof, a "C/M Transaction" shall mean
(i) a merger or consolidation of the Company with or into another entity in a
transaction where the Company is not the resulting or surviving entity or (ii) a
merger of the Company with or into another entity in a transaction where the
shares of the Company's capital stock outstanding immediately prior to the
closing of such merger are converted into or exchanged for cash, other property
or securities of an entity other than the Company.
(c) Recapitalization or Reorganization. In the event of a recapitalization
----------------------------------
or reorganization of the Company (other than a transaction described in
subparagraph (b) above) pursuant to which securities of the Company or of
another corporation are issued with respect to the outstanding shares of Common
Stock, an optionee upon exercising an option shall be entitled to receive for
the purchase price paid upon such exercise the securities he would have received
if he had exercised his option prior to such recapitalization or reorganization.
(d) Modification of ISOs. Notwithstanding the foregoing, any adjustments
--------------------
made pursuant to subparagraphs (a), (b) or (c) with respect to ISOs shall be
made only after the Committee, after consulting with counsel for the Company,
determines whether such adjustments would constitute a "modification" of such
ISOs (as that term is defined in Section 424 of the Code) or would cause any
adverse tax consequences for the holders of such ISOs. If the Committee
determines that such adjustments made with respect to ISOs would constitute a
modification of such ISOs, it may refrain from making such adjustments.
(e) Dissolution or Liquidation. In the event of the proposed dissolution or
--------------------------
liquidation of the Company, each option will terminate immediately prior to the
consummation of such proposed action or at such other time and subject to such
other conditions as shall be determined by the Board.
(f) Issuances of Securities. Except as expressly provided herein, no
-----------------------
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
subject to options. No adjustments shall be made for dividends paid in cash or
in property other than securities of the Company.
(g) Fractional Shares. No fractional shares shall be issued under the Plan
-----------------
and the optionee shall receive from the Company cash in lieu of such fractional
shares.
6
<PAGE>
(h) Adjustments. Upon the happening of any of the events described in
-----------
subparagraphs (a), (b) or (c) above, the class and aggregate number of shares
set forth in Section 2 hereof that are subject to options which previously have
been or subsequently may be granted under the Plan shall also be appropriately
adjusted to reflect the events described in such subparagraphs. The Committee
or the Successor Board shall determine the specific adjustments to be made under
this paragraph 11 and, subject to Section 3, its determination shall be
conclusive.
If any person or entity owning restricted Common Stock obtained by exercise
of an option made hereunder receives shares or securities or cash in connection
with a corporate transaction described in subparagraphs (a), (b) or (c) above as
a result of owning such restricted Common Stock, such shares or securities or
cash shall be subject to all of the conditions and restrictions applicable to
the restricted Common Stock with respect to which such shares or securities or
cash were issued, unless otherwise determined by the Committee or the Successor
Board.
12. No Employment Rights.
--------------------
Nothing contained in the Plan or in any option granted under the Plan shall
confer upon any option holder any right with respect to the continuation of his
employment by the Company (or any subsidiary) or interfere in any way with the
right of the Company (or any subsidiary), subject to the terms of any separate
employment agreement to the contrary, at any time to terminate such employment
or to increase or decrease the compensation of the option holder from the rate
in existence at the time of the grant of an option. Whether an authorized leave
of absence, or absence in military or government service, shall constitute
termination of employment shall be determined by the Committee at the time.
13. Withholding.
-----------
The Company's obligation to deliver shares upon the exercise of any option
granted under the Plan shall be subject to the option holder's satisfaction of
all applicable Federal, state and local income, excise and employment tax
withholding requirements. The Company and employee may agree to withhold shares
of Common Stock purchased upon exercise of an option to satisfy the above-
mentioned withholding requirements. With the approval of the Committee, which
it shall have sole discretion to grant, and on such terms and conditions as the
Committee may impose, the option holder may satisfy the foregoing condition by
electing to have the Company withhold from delivery shares having a value equal
to the amount of tax to be withheld. The Committee shall also have the right to
require that shares be withheld from delivery to satisfy such condition.
14. Restrictions on Issue of Shares.
-------------------------------
(a) Notwithstanding the provisions of Section 7, the Company may delay the
issuance of shares covered by the exercise of an option and the delivery of a
certificate for such shares until one of the following conditions shall be
satisfied:
7
<PAGE>
(i) The shares with respect to which such option has been exercised
are at the time of the issuance of such shares effectively registered or
qualified under applicable federal and state securities laws now in force or as
hereafter amended; or
(ii) Counsel for the Company shall have given an opinion, which
opinion shall not be unreasonably conditioned or withheld, that such shares are
exempt from registration and qualification under applicable federal and state
securities laws now in force or as hereafter amended.
(b) It is intended that all exercises of options shall be effective, and
the Company shall use its best efforts to bring about compliance with the above
conditions within a reasonable time, except that the Company shall be under no
obligation to qualify shares or to cause a registration statement or a post-
effective amendment to any registration statement to be prepared for the purpose
of covering the issuance of shares in respect of which any option may be
exercised, except as otherwise agreed to by the Company in writing.
15. Purchase for Investment; Rights of Holder on Subsequent Registration.
--------------------------------------------------------------------
Unless the shares to be issued upon exercise of an option granted under the
Plan have been effectively registered under the Securities Act of 1933, as now
in force or hereafter amended, the Company shall be under no obligation to issue
any shares covered by any option unless the person who exercises such option, in
whole or in part, shall give a written representation and undertaking to the
Company which is satisfactory in form and scope to counsel for the Company and
upon which, in the opinion of such counsel, the Company may reasonably rely,
that he or she is acquiring the shares issued pursuant to such exercise of the
option for his or her own account as an investment and not with a view to, or
for sale in connection with, the distribution of any such shares, and that he or
she will make no transfer of the same except in compliance with any rules and
regulations in force at the time of such transfer under the Securities Act of
1933, or any other applicable law, and that if shares are issued without such
registration, a legend to this effect may be endorsed upon the securities so
issued. In the event that the Company shall, nevertheless, deem it necessary or
desirable to register under the Securities Act of 1933 or other applicable
statutes any shares with respect to which an option shall have been exercised,
or to qualify any such shares for exemption from the Securities Act of 1933 or
other applicable statutes, then the Company may take such action and may require
from each optionee such information in writing for use in any registration
statement, supplementary registration statement, prospectus, preliminary
prospectus or offering circular as is reasonably necessary for such purpose and
may require reasonable indemnity to the Company and its officers and directors
and controlling persons from such holder against all losses, claims, damages and
liabilities arising from such use of the information so furnished and caused by
any untrue statement of any material fact therein or caused by the omission to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances under which
they were made.
8
<PAGE>
16. Loans.
-----
The Company may make loans to optionees to permit them to exercise options.
If loans are made, the requirements of all applicable federal and state laws and
regulations regarding such loans must be met.
17. Approval of Stockholders.
------------------------
The Plan shall be subject to approval by the vote of stockholders holding at
least a majority of the voting stock of the Company voting in person or by proxy
at a duly held stockholders' meeting, or by written consent of stockholders
holding at least a majority of the voting stock of the Company, within twelve
(12) months after the adoption of the Plan by the Board and shall take effect as
of the date of adoption by the Board upon such approval. The Committee may
grant options under the Plan prior to such approval, but any such option shall
become effective as of the date of grant only upon such approval and,
accordingly, no such option may be exercisable prior to such approval.
18. Termination and Amendment.
-------------------------
Unless sooner terminated as herein provided, the Plan shall terminate ten
(10) years from the date upon which the Plan was duly adopted by the Board. The
Committee may at any time terminate the Plan or make such modification or
amendment thereof as it deems advisable; provided, however, that except as
-------- -------
provided in this Section 18, the Committee may not, without the approval of the
stockholders of the Company obtained in the manner stated in Section 17,
increase the maximum number of shares for which options may be granted or change
the designation of the class of persons eligible to receive options under the
Plan. The Committee may grant options to persons hereunder after an amendment
to the Plan by the Committee requiring stockholder approval under this Section
18, but any such option shall become effective as of the date of grant only upon
such approval and, accordingly, no such option may be exercisable prior to such
approval. The Committee may terminate, amend or modify any outstanding option
with or without the consent of the option holder; provided, however, that,
-------- -------
except as provided in Section 11, without the consent of the optionee, the
Committee shall not change the number of shares subject to an option, nor the
exercise price thereof, nor extend the term of such option.
19. Reservation of Stock.
--------------------
The Company shall at all times during the term of the Plan reserve and keep
available such number of shares of stock as will be sufficient to satisfy the
requirements of the Plan and shall pay all fees and expenses necessarily
incurred by the Company in connection therewith.
20. Limitation of Rights in the Option Shares.
-----------------------------------------
An optionee shall not be deemed for any purpose to be a stockholder of the
Company with respect to any of the options except to the extent that the option
shall have been exercised with
9
<PAGE>
respect thereto, the exercise price shall have been paid in full, the optionee
shall have complied with all applicable provisions of the Plan and the agreement
pursuant to which such options were granted and, in addition, a certificate
shall have been issued theretofore and delivered to the optionee.
21. Notices.
-------
Any communication or notice required or permitted to be given under the Plan
shall be in writing, and mailed by registered or certified mail or delivered by
hand, if to the Company, to its principal place of business, attention:
President, and, if to an optionee, to the address as appearing on the records of
the Company.
Adopted by the Board of Directors: March 14, 1997
Adopted by the Stockholders: March 14, 1997
Amended and Restated by the Board of Directors: April 9, 1998
Amended and Restated Plan approved by the Stockholders: June 9, 1998
10
<PAGE>
WEBSPECTIVE SOFTWARE, INC.
Incentive Stock Option Agreement
--------------------------------
Option Number: ISO-___
Specific Terms of the Option
- ----------------------------
Subject to the terms and conditions hereinafter set forth and the terms and
conditions of the WebSpective Software, Inc. 1997 Stock Option Plan (the
"Plan"), WebSpective Software, Inc. (formerly, Atreve Software, Inc.), a
----
Delaware corporation (the "Company"), hereby grants the following option (the
-------
"Option") to purchase Common Stock, par value $.01 per share (the "Common
- ------- ------
Stock"), of the Company:
- -----
1. Name of Person to Whom the Option is granted (the "Optionee"): [_________].
--------
2. Date of Grant of Option (the "Grant Date"): [_________].
----------
3. Number of shares of Common Stock issuable under the Option (the "Option
------
Shares"): [_________] shares, subject to adjustment as provided herein and in
- ------
the Plan.
4. Option exercise price per Option Share (the "Exercise Price"): [$_______],
--------------
subject to adjustment as provided herein and in the Plan.
5. Term of Option: Subject to Section 11 and Section 18(e) below, this Option
shall terminate at 5:00 p.m., Boston Time, on [___________].
6. Vesting Start Date: [_________].
6A. Initial Date of Optionee's Employment with the Company: [_______] (the
"Employment Date").
- ----------------
7. Acknowledgment: By executing below, the Optionee acknowledges and agrees
that he or she has received a copy of the Plan, and that this Option is subject
to the terms and conditions set forth in the Plan and the terms and conditions
set forth in these Specific Terms of the Option and the attached Other Terms of
the Option, including, without limitation, the restrictions on transfer,
repurchase rights and other restrictions set forth herein and therein.
IN WITNESS WHEREOF, the Company and the Optionee have entered into this
Option Agreement (including the attached Other Terms of the Option) as an
instrument under seal as of the Grant Date.
WEBSPECTIVE SOFTWARE, INC.
By:_________________________ X _____________________________
Name: (Signature of Optionee)
Title:
Print Name:____________________
Date:__________________________
Optionee's Address:____________
_______________________________
_______________________________
_______________________________
<PAGE>
Other Terms of the Option
- -------------------------
WHEREAS, in accordance with and subject to the terms set forth herein and
in the immediately preceding Specific Terms of the Option (the "Specific
--------
Terms"), the Company desires to grant to the Optionee the Option pursuant to the
- -----
terms of the Plan (capitalized terms used herein, unless otherwise defined
herein, have the meanings ascribed to them in the Plan); and
WHEREAS, in accordance with Section 5 of the Plan, these Other Terms of the
Option, together with the Specific Terms, set forth the terms and conditions of
the Option;
NOW THEREFORE, in consideration of the premises and of the mutual covenants
and agreements contained herein, the Company and the Optionee hereby agree as
set forth in the Specific Terms and as follows:
8. Grant of Option. Pursuant to and subject to the Plan, the Company
---------------
hereby grants to the Optionee the Option to purchase from the Company all or any
part of the Option Shares as set forth in Section 3 of the Specific Terms,
subject to adjustment as provided herein and in the Plan, upon the terms and
conditions set forth in the Plan and upon the additional terms and conditions
hereinafter set forth. This Option is intended to qualify as an "incentive stock
option" under Section 422 of the Code.
9. Exercise Price. The exercise price per share for the Option Shares
--------------
shall be the Exercise Price as set forth in Section 4 of the Specific Terms,
subject to adjustment as provided herein and in the Plan.
10. Rights to Exercise. The Option shall be immediately exercisable with
------------------
respect to all of the Option Shares as of the Grant Date.
11. Term of Options; Exercisability.
-------------------------------
(a) Term.
----
(1) The Option shall expire ten (10) years from the Grant Date,
but shall be subject to earlier termination as herein provided.
(2) If the Optionee's employment with the Company and all Related
Corporations is terminated, for any reason or no reason, then,
subject to Sections 11(a)(3), 11(a)(4) and 11(a)(5) below, the
Option shall terminate on the earlier of (X) thirty days
following the date the Optionee's employment is terminated, or
(Y) on the date on which the Option expires by its terms in
accordance with section 11(a)(1) above.
(3) If the Optionee's employment is terminated because the
Optionee has become permanently disabled (within the meaning of
Section 22(e)(3) of the Code), the Option shall terminate on the
earlier of (X) the last day of the sixth month from the date the
Optionee ceases to be an employee of the Company, or (Y) on the
date on which the Option expires by its terms, in accordance with
Section 11(a)(1) above.
<PAGE>
(4) If the Optionee's employment is terminated because of the
death of the Optionee, the Option shall terminate on the earlier
of (X) the last day of the twelfth month from the date of death,
or (Y) on the date on which the Option expires by its terms, in
accordance with Section 11(a)(1) above.
(5) If the Optionee's employment with the Company is terminated
by the Company for Cause (as defined herein), the Option shall
terminate immediately on the date of such termination.
(b) Definition of Cause. For purposes hereof, "Cause" shall mean
------------------- -----
conduct involving one or more of the following: (i) disloyalty, gross
negligence, willful misconduct, dishonesty or breach of fiduciary duty to the
Company or Related Corporation, if such disloyalty, gross negligence, willful
misconduct, dishonesty or breach of fiduciary duty is materially detrimental to
the interests of the Company or Related Corporation; (ii) the commission of an
act of embezzlement or fraud that is materially detrimental to the interests of
the Company or Related Corporation; (iii) deliberate disregard of the rules or
policies of the Company or Related Corporation which results in material loss,
damage or injury to the Company or Related Corporation; (iv) the willful,
unauthorized disclosure of any material trade secret or confidential
information of the Company or Related Corporation; or (v) the commission of an
act which constitutes unfair competition with the Company or Related Corporation
or which induces any customer or supplier to breach a contract with the Company
or Related Corporation and which is materially detrimental to the interests of
the Company or Related Corporation.
12. Manner and Exercise of Option.
-----------------------------
(a) The Option may be exercised in full or in part by giving written
notice to the Company stating the number of Option Shares for which the Option
is being exercised and accompanied by payment in full of the Exercise Price with
respect to such Option Shares. Such notice shall be signed by the person or
persons so exercising this Option. Payment of the Exercise Price for such
Option Shares may be made in the following manner: (i) wholly in cash or by
check payable to the Company; (ii) by delivery of an assignment satisfactory in
form and substance to the Company of a sufficient amount of the proceeds from
the sale of the Option Shares and an instruction to the broker or selling agent
to pay that amount to the Company; or (iii) by any combination of the foregoing.
Upon such exercise, delivery of a certificate for fully paid, non-assessable
Option Shares shall be made at the principal office of the Company to the person
exercising the Option, promptly following receipt of the notice by the Company.
(b) The Company shall at all times during the term of the Option
reserve and keep available such number of Option Shares as will be sufficient to
satisfy the requirements of the Option. The Optionee shall not have any of the
rights of a stockholder of the Company in respect of the Option Shares until one
or more certificates for such Option Shares shall be issued by the Company upon
the due exercise of the Option.
13. Non-Transferability of the Option and the Option Shares. (a) The
-------------------------------------------------------
right of the Optionee to exercise the Option shall not be assignable or
transferable by the Optionee otherwise than by will or the laws of descent and
distribution. The Option may be exercised during the lifetime of the Optionee
only by the Optionee. The Option shall be null and void and without effect upon
the bankruptcy of the Optionee or upon any attempted assignment or transfer,
including without limitation any purported assignment, whether voluntary or by
operation of law, pledge, hypothecation or other disposition contrary to the
provisions hereof, or levy of execution, attachment, trustee process or similar
process, whether legal or equitable, upon the Option.
-2-
<PAGE>
(b) Except for the transfer of the Covered Shares (as defined herein)
to the Company or its assignees as contemplated by this Agreement, none of the
Unreleased Shares or any beneficial interest therein shall be transferred,
pledged, encumbered or otherwise disposed of in any way until the release of
such Shares from the Company's Repurchase Right in accordance with the
provisions of this Agreement. In addition, the Optionee shall not sell, assign,
transfer, pledge, hypothecate, mortgage or dispose of, by gift or otherwise, or
in any way encumber, all or any part of the Released Shares that have been
issued upon exercise of the Option, except in compliance with this Agreement,
including, without limitation, in compliance with the following restrictions:
(i) the Company's right of repurchase set forth in Section 18, (ii) the
Optionee's agreement to lock-up the Option Shares for a period of at least 180
days after the consummation of an underwritten public offering of Common Stock
set forth in Section 22 and (iii) the right of first refusal in favor of the
Company set forth in Section 17; provided, however, that the restrictions
-------- -------
described in clause (iii) above shall not apply to transfers in compliance with
the provisions of Section 21 (Permitted Transfers).
14. Representation Letter and Legends.
---------------------------------
(a) In the event that for any reason the Option Shares to be issued
upon exercise of the Option shall not be effectively registered under the
Securities Act of 1933 (the "1933 Act"), upon any date on which the Option so
--------
exercised in whole or in part, the person exercising the Option shall give a
written representation to the Company in the form attached hereto as Exhibit 1
---------
and the Company shall place an "investment legend," so-called, as described in
Exhibit 1, upon any certificate for the Option Shares issued by reason of such
- ---------
exercise. In addition, each certificate evidencing any of the Option Shares
shall bear a legend substantially as follows:
"The shares represented by this certificate are subject to
restrictions on transfer (including a right of repurchase in favor of the
Company) and may not be sold, exchanged, transferred, pledged, hypothecated or
otherwise disposed of except in accordance with and subject to all the terms and
conditions of a certain stock option agreement, a copy of which the Company will
furnish to the holder of this certificate upon request and without charge."
(b) The Company shall be under no obligation to qualify Option Shares
or to cause a registration statement or a post-effective amendment to any
registration statement to be prepared for the purposes of covering the issuance
of the Option Shares.
15. Recapitalization, Reorganizations, Changes in Control and the Like.
------------------------------------------------------------------
Except as otherwise set forth herein, adjustments and other matters relating to
the merger or consolidation of the Company with or into another entity shall be
made and determined in accordance with Section 11 of the Plan, as in effect on
the date of this Agreement.
16. No Rights to Employment. Neither the Plan, this Agreement nor the
-----------------------
grant of this Option imposes any obligation on the Company or a Related
Corporation to employ the Optionee.
17. Company's Right of First Refusal.
--------------------------------
(a) Exercise of Right. If at any time the Optionee or his or her
-----------------
legal representative (the "Transferor") desires to transfer all or any part of
----------
the Option Shares to any person other than the Company (an "Offeror"), the
-------
Transferor shall: (i) obtain in writing an irrevocable and unconditional bona
fide offer (the "Offer") for the purchase thereof from the Offeror; and (ii)
-----
give written notice (the "Option Notice") to the Company setting forth the
-------------
Optionee's desire to transfer such shares, which
-3-
<PAGE>
Option Notice shall be accompanied by a photocopy of the Offer. The Option
Notice must specify the name and address of the Offeror, the number of Option
Shares subject to such Offer, the terms and conditions (including price) of the
proposed transfer and any other material facts relating to the proposed
transfer. Upon receipt of the Option Notice, the Company shall have an
assignable option to purchase any or all of such shares (the "Company Option
--------------
Shares") specified in the Option Notice, such option to be exercisable by
- ------
giving, within 30 days after receipt of the Option Notice, a written counter-
notice to the Transferor. If the Company elects to purchase any or all of such
Company Option Shares, it shall be obligated to purchase, and the Transferor
shall be obligated to sell to the Company, such Company Option Shares at the
price per share and on the other terms and conditions, including deferred
payment (if applicable), indicated in the Option Notice within 30 days from the
date of delivery by the Company of such counter-notice. To the extent the
consideration proposed to be paid by the Offeror for the Offered Shares consists
of property other than cash or a promissory note, the consideration to be paid
by the Company exercising its option under this Section may, at the option of
the Company, consist of cash equal to the value of such property, as determined
in good faith by the Board of Directors of the Company.
(b) Sale of Option Shares to Offeror. The Transferor may, for 60 days
--------------------------------
after the expiration of the 30-day period during which the Company may give the
counter-notice, sell, pursuant to the terms of the Offer, any or all of such
Company Option Shares not purchased or agreed to be purchased by the Company or
its assignee; provided, however, that the Transferor shall not sell such Company
-------- -------
Option Shares to the Offeror if the Offeror is a competitor of the Company and
the Company gives written notice to the Transferor, within 30 days of its
receipt of the Option Notice, stating that the Transferor shall not sell such
Company Option Shares to such Offeror; and provided, further, that prior to the
-------- -------
sale of such Company Option Shares to the Offeror, the Offeror shall execute an
agreement with the Company pursuant to which the Offeror agrees to be subject to
the restrictions set forth in this Agreement. If any or all of such Company
Option Shares are not sold pursuant to an Offer within the time permitted above,
the unsold Company Option Shares shall remain subject to the terms of this
Section 17.
(c) Expiration of Company's Right of First Refusal and Transfer
-----------------------------------------------------------
Restrictions. The transfer restrictions set forth in this Section 17 (Company's
- ------------
Right of First Refusal) shall remain in effect until such time, if ever, as a
distribution to the public is made of shares of Common Stock pursuant to a
registration statement filed under the 1933 Act or a successor statute, at which
time the transfer restrictions set forth in this section 17 will automatically
terminate.
18. Company's Right of Repurchase.
-----------------------------
(a) Unreleased or Released Shares. At any time when the Repurchase
-----------------------------
Right (as defined below) of the Company is in effect, the Option Shares which
are not yet released as of such time from the Repurchase Right pursuant to
Section 18(d) shall be referred to herein as "Unreleased Shares" and the Option
-----------------
Shares which are released as of such time pursuant to Section 18(d) shall be
referred to herein as "Released Shares." The term "Option Shares" used without
--------------- -------------
reference to either Unreleased Shares or Released Shares shall mean both the
Unreleased Shares and the Released Shares, without distinction.
(b) Right of Repurchase. The Company shall have the right (the
-------------------
"Repurchase Right") to repurchase from the holder of this Option, all or any
- -----------------
portion of the Covered Shares (as defined below) upon the occurrence of any of
the events specified in Section 18(c) below (a "Repurchase Event"), at the
----------------
Exercise Price per Covered Share. The Repurchase Right may be exercised by the
-4-
<PAGE>
Company within 90 days following the later of the date of the exercise of this
Option or the date the Company receives actual knowledge of a Repurchase Event
(the "Repurchase Period"). The Repurchase Right shall be exercised by the
-----------------
Company by giving the holder written notice on or before the last day of the
Repurchase Period of its intention to exercise the Repurchase Right, which
notice shall specify the number of Covered Shares to be so repurchased, and,
together with such notice, tendering to the holder an amount equal to Exercise
Price for each Covered Share to be so repurchased (such date and time of
exercise being referred to herein as the "Company Exercise Date"). Upon
---------------------
exercise of the Repurchase Right in the manner provided in this Section 18(b),
the holder shall deliver to the Company, within ten (10) days of receipt of the
Company's notice of such repurchase, the stock certificate or certificates
representing the Option Shares being repurchased, duly endorsed and free and
clear of any and all liens, charges and encumbrances. If Covered Shares are not
repurchased under the Repurchase Right, the Optionee and his or her successor in
interest, if any, will hold any such shares in his or her possession subject to
all of the provisions of this Agreement. For purposes hereof, the term "Covered
-------
Shares" shall mean the number of Option Shares equal to the difference between
- ------
(i) the number of Option Shares for which the Option has been exercised as of
the Company Exercise Date minus (ii) the number of Released Shares as of the
-----
Company Exercise Date; provided, however, that the number of Covered Shares
-------- -------
shall not be less than zero.
(c) Company's Right to Exercise Repurchase Right. The Company shall
--------------------------------------------
have the Repurchase Right in the event that any of the following events shall
occur:
(i) The termination of the Optionee's employment with the Company,
voluntarily or involuntarily, for any reason whatsoever;
(ii) The receivership, bankruptcy or other creditor's proceeding
regarding the Optionee or the taking of any of the Optionee's
shares acquired upon exercise of this option by legal process,
such as a levy of execution; or
(iii) Distribution of shares held by the Optionee to his or her spouse
as such spouse's joint or community interest pursuant to a
decree of dissolution, operation of law, divorce, property
settlement agreement or for any other reason, except as may be
otherwise permitted by the Company.
(d) Release of Option Shares from Repurchase Right. As of the
----------------------------------------------
Vesting Start Date set forth in Section 6 of the Specific Terms (the "Vesting
-------
Start Date") all of the Option Shares shall be deemed to be Unreleased Shares.
- ----------
To the extent provided herein, the Option Shares, together with any additional
rights or shares attributable to such Option Shares, will be released from the
Repurchase Right and shall be deemed to be Released Shares as follows:
(i) If the Optionee has been employed with the Company for less than
one year as of the Vesting Start Date, a number of Option Shares
equal to the product (rounded down) of (A) the Initial Vesting
Percentage (as defined below) multiplied by (B) the total number
-------------
of Option Shares, shall be released from the Repurchase Right on
the first anniversary of the Employment Date. In addition,
commencing on the thirtieth day after the first anniversary of
the Employment Date and on the last day of each successive 30-
day period thereafter, a number of Option Shares equal to the
quotient (rounded down) of (A) the total number of Option Shares
divided by (B) 48, shall be released from the Repurchase Right.
------- --
-5-
<PAGE>
(ii) If the Optionee has been employed with the Company for one year
or more as of the Vesting Start Date, then commencing on the
thirtieth day after the Vesting Start Date and on the last day
of each successive 30-day period thereafter, a number of Option
Shares equal to the quotient (rounded down) of (A) the total
number of Option Shares divided by (B) 48, shall be released
------- --
from the Repurchase Right.
(iii) From and after the occurrence of a Change in Control (as defined
below), the total number of Option Shares released from the
Repurchase Right as of a particular date shall be equal to the
total number of Option Shares that would otherwise have been
released pursuant to this Section 18(d) without giving effect to
this Section 18(d)(iii) on the date that is 420 days after such
date.
(iv) The balance of the Unreleased Shares shall be released from the
Repurchase Option on the fourth anniversary of the Vesting Start
Date.
For purposes hereof, the following terms shall have the following
meanings:
The term "Change in Control" shall mean the closing of (i) a
-----------------
sale by the Company of all or substantially all of its assets, (ii) the
acquisition in a single transaction, or a series of related transactions, of
shares of capital stock of the Company representing at least a majority of the
issued and outstanding shares of capital stock of the Company (measured on the
basis of voting power) by a person (as defined in Section 13(d) of the Exchange
Act), or (iii) a merger or consolidation of the Company with or into another
entity in a transaction where the shares of the Company's capital stock
outstanding immediately prior to the closing of such merger or consolidation
represent or are converted into or exchanged for shares that represent less than
a majority of the shares of capital stock of the resulting or surviving entity
outstanding immediately after the closing of such merger or consolidation.
The term "Initial Vesting Percentage" shall mean a percentage
--------------------------
equal to the quotient obtained by dividing (A) the number of complete 30-day
periods that have elapsed from the Vesting Start Date through the first
anniversary of the Employment Date by (B) forty-eight (48); provided, however,
-- -------- -------
if the Optionee's Vesting Start Date and Employment Date are the same, the
Initial Vesting Percentage shall be equal to twenty-five percent (25%).
(e) Partial Exercise. The number of shares for which this Option
----------------
shall be exercisable from and after the Company Exercise Date shall be reduced
by, and the Option shall no longer be exercisable for, the number of Option
Shares equal to the difference between (i) the number of Unreleased Shares as of
the Company Exercise Date minus (ii) the number of Covered Shares as of the
Company Exercise Date (such difference being referred to herein as the
"Remaining Shares"). Notwithstanding anything to the contrary contained herein
- -----------------
or in the Option Agreement, if, upon the occurrence of any Company Exercise
Date, the number of Remaining Shares is zero or less, then the Option shall
immediately terminate.
(f) Example. By way of illustration only (assuming (i) the Optionee
-------
was granted an Option to purchase 1,000 Option Shares on December 1, 1999 (such
Optionee's Employment Date), (ii) the Vesting Start Date for such Optionee was
December 1, 1999 and (iii) such Optionee was continuously employed with the
Company through January 1, 2001 at which time a Change in Control occurred), the
Option Shares relating to an Option would be released from the Repurchase Right
as follows:
-6-
<PAGE>
1. On December 1, 2000, 250 Option Shares would be released from
the Repurchase Right;
2. On December 31, 2000, an additional 20 shares would be released
from the Repurchase Right; and
3. On January 1, 2001 (the occurrence of such Change in Control)
an additional 280 shares would be released from the Repurchase
Right.
19. Adjustments for Changes in Capital Structure. If there shall be any
--------------------------------------------
change in the Common Stock of the Company through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split, combination or
exchange of shares, or the like, the restrictions contained in this Agreement
(including the right of repurchase in favor of the Company contained in Section
18) shall apply with equal force to additional and/or substitute securities, if
any, received by the Optionee in exchange for, or by virtue of his or her
ownership of, Option Shares, except as otherwise determined by the Board of
Directors of the Company.
20. Failure to Deliver Company Option Shares. If the Transferor fails or
----------------------------------------
refuses to deliver on a timely basis duly endorsed certificates representing
Option Shares to be sold to the Company or its assignee pursuant to Section 17
or Section 18, the Company shall have the right to deposit the purchase price
for such Option Shares in a special account with any bank or trust company in
the Commonwealth of Massachusetts, giving notice of such deposit to the
Transferor, whereupon such Option Shares shall be deemed to have been purchased
by the Company. All such monies shall be held by the bank or trust company for
the benefit of the Transferor. All monies deposited with the bank or trust
company remaining unclaimed for two years after the date of deposit shall be
repaid by the bank or trust company to the Company on demand, and the Transferor
shall thereafter look only to the Company for payment.
21. Permitted Transfers. Anything herein to the contrary notwithstanding,
-------------------
the provisions of Sections 13(b), 17 and 18 shall not apply to: (a) any
transfer of Released Shares that have been issued upon exercise of the Option by
gift or bequest or through inheritance to, or for the benefit of, any member or
members of the Optionee's immediate family; or (b) any transfer of Released
Shares by the Optionee by way of gift for estate planning purposes to a trust
for the benefit of the Optionee or any member of his or her immediate family.
In the event of any such transfer, prior to and as a condition precedent to such
transfer, the transferee of such Released Shares shall provide the Company with
a written agreement to be bound by the terms of this Agreement to the same
extent as the Optionee, and such transferee shall hold the Released Shares so
acquired with all the rights conferred by, and subject to all the restrictions
imposed by, this Agreement.
22. Lock-up Agreement. The Optionee agrees that in connection with an
-----------------
underwritten public offering of Common Stock, upon the request of the Company or
the principal underwriter managing such public offering, the Option Shares may
not be sold, offered for sale or otherwise disposed of without the prior written
consent of the Company or such underwriter, as the case may be, for at least 180
days after the consummation of such offering, or such longer period of time as
the Board of Directors may determine if all of the Company's directors and
officers agree to be similarly bound. The obligations under this Section 22
shall remain effective for all underwritten public offerings with respect to
which the Company has filed a registration statement on or before the date five
(5) years after the closing of the Company's initial public offering; provided,
--------
however, that this Section 22 shall cease to apply to any Option Shares sold to
- -------
the public pursuant to an effective registration statement or sold to the
-7-
<PAGE>
public pursuant to an exemption from the registration requirements of the
Securities Act of 1933 in a transaction that complied with the terms of this
Agreement.
23. Section 83(b) Election. In order to ensure that the tax consequences
----------------------
of such exercise will be determined at the time of exercise, Optionee agrees to
file a timely election under Section 83(b) of the Code to include in Optionee's
taxable income, at the time of exercise, the difference between the fair market
value of the Option Shares received upon exercise of this option and the amount
paid for such shares; provided, however, that the Board, in its sole and
-------- -------
absolute discretion, may waive the requirement that the Optionee file such
election.
24. Withholding Taxes. The Company shall have the right to withhold (or
-----------------
to cause a Related Corporation to withhold) from compensation otherwise payable
to the Optionee, or to require the Optionee to remit to the Company an amount
sufficient to satisfy all federal, state and local withholdings tax requirements
in respect of the Option Shares being purchased by the Optionee prior to the
issuance of such Option Shares and the delivery of any certificate or
certificates for such Option Shares or the payment of any consideration
specified in Section 13 of the Plan, and from time to time thereafter as a
result of any reason whatsoever.
25. Notice to Company of Disqualifying Disposition. The Optionee agrees
----------------------------------------------
to notify the Company in writing immediately after the Optionee makes a
Disqualifying Disposition (as described in Sections 421, 422 and 424 of the Code
and regulations thereunder) of any Option Shares acquired pursuant to the
exercise of this Option. A Disqualifying Disposition is generally any
disposition occurring on or before the later of (a) the date two years following
the Grant Date or (b) the date one year after the date the Optionee acquires the
Option Shares. The Optionee also agrees to provide the Company with any
information concerning any such Disqualifying Disposition required by the
Company for tax purposes.
26. Amendment and Waiver. This Agreement may be amended, modified or
--------------------
supplemented, and waivers or consents to departures from the provisions hereof
may be given, provided that the same are in writing and signed by the parties.
27. Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with, the General Corporation Law of the State of
Delaware as to matters within the scope thereof and, as to all other matters,
shall be governed by and construed and enforced in accordance with the internal
laws of the Commonwealth of Massachusetts without regard to principles of
conflicts of laws.
28. Notices. Any notices or other communications required to be given
-------
hereunder shall be given by hand delivery or by first class mail with all fees
prepaid and addressed, if to the Company, to it at 66 B Street, Needham,
Massachusetts 02194, Attn: President, and if to Optionee, to him at the address
set forth in the signature page hereto.
-8-
<PAGE>
EXHIBIT 1
TO STOCK OPTION AGREEMENT
[Date]
---------
WebSpective Software, Inc.
66 B Street
Needham, MA 02194
Gentlemen:
In connection with the acquisition by me of ______ shares of common stock,
$.01 par value per share (the "Shares"), of WebSpective Software, Inc., a
------
Delaware corporation (the "Company"), I hereby represent to the Company as
-------
follows:
(a) I hereby confirm that: (i) the Shares to be received by me will be
acquired for investment only, for my own account, not as a nominee or agent and
not with a view to the sale or distribution of any part thereof; and (ii) I have
no current intention of selling, granting participation in or otherwise
distributing the Shares. I further represent that I do not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
participation to such person, or to any third person, with respect to any of the
Shares.
(b) I understand that the Shares have not been registered under the
Securities Act of 1933 (the "1933 Act") on the basis that the acquisition of the
--------
Shares by me and the issuance of securities by the Company to me is exempt from
registration under the 1933 Act and that the Company's reliance on such
exemption is predicated on my representations set forth herein.
(c) I represent that I have, either alone or together with the assistance
of a "purchaser representative" (as that term is defined in Regulation D
promulgated under the 1933 Act), such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of my
investment in the Company. I further represent that I am familiar with the
business and financial condition, properties, operations and prospects of the
Company. I further represent that I have had, prior to my acquisition of the
Shares, the opportunity to ask questions of, and receive answers from, the
Company concerning the terms and conditions of the issuance and to obtain
information (to the extent the Company possessed such information or could
acquire it without unreasonable effort or expense) necessary to verify the
accuracy of any information furnished to me or to which I have had access. I am
satisfied that there is no material information concerning the condition,
properties, operations and prospects of the Company of which I am unaware. I
have made, either alone or together with my advisors, such independent
investigation of the Company as I deem to be, or my advisors deem to be,
necessary or advisable in connection with this investment.
(d) I understand that the Shares may not be sold, transferred or otherwise
disposed of without registration under the 1933 Act and applicable state
securities laws, or an exemption therefrom, and that in the absence of an
effective registration statement covering the Shares or an available
<PAGE>
exemption from registration under the 1933 Act or applicable state securities
laws, the Shares must be held indefinitely. In particular, I acknowledge that I
am aware that the Shares may not be sold pursuant to Rule 144 promulgated under
the 1933 Act unless all of the conditions of that Rule are met. Among the
current conditions for use of Rule 144 by certain holders is the availability to
the public of current information about the Company. Such information is not now
available, and the Company has no current plans to make such information
available. I represent that, in the absence of an effective registration
statement covering the Shares or an available exemption from registration under
the 1933 Act or applicable state securities laws, I will not sell, transfer or
otherwise dispose of the Shares.
(e) I represent that I (i) am capable of bearing the economic risk of
holding the unregistered Shares for an indefinite period of time and have
adequate means for providing for my current needs and contingencies, (ii) can
afford to suffer a complete loss of my investment in the Shares, and (iii)
understand and have taken cognizance of all risk factors related to the
acquisition of the Shares.
(f) I understand that the acquisition of the Shares involves a high degree
of risk and there is no established market for the Company's capital stock and
it is not likely that any public market for such stock will develop in the near
future.
(g) I represent that neither I nor anyone acting on my behalf has paid any
commission or other remuneration to any person in connection with the
acquisition of the Shares.
(h) Independent of the additional restrictions on the transfer of the
Shares contained herein, I agree that I will not make a transfer, disposition or
pledge of any of the Shares other than pursuant to an effective registration
statement under the 1933 Act and applicable state securities laws, unless and
until: (i) I shall have notified the Company of the proposed disposition and
shall have furnished the Company with a statement of the circumstances
surrounding the disposition and (ii) if requested by the Company and at my
expense or at the expense of my transferee, I shall have furnished to the
Company an opinion of counsel, reasonably satisfactory (as to counsel and as to
substance) to the Company and its counsel, to the effect that such transfer may
be made without registration of the Shares under the 1933 Act, and applicable
state securities laws.
(i) I acknowledge that all certificates evidencing the Shares shall bear a
legend in substantially the following form:
"TRANSFER RESTRICTED"
-------------------
The shares represented by this certificate have not been registered
under the Securities Act of 1933 and applicable state securities laws.
These shares have been acquired for investment and not with a view to
distribution or resale, and may not be sold, mortgaged, pledged,
hypothecated or otherwise transferred without an effective
registration statement for such shares under the Securities Act of
1933 and applicable state securities laws, or an opinion of counsel
satisfactory to the Company that registration is not required under
such Act and applicable state securities laws.
The shares of stock represented by this certificate are subject to
restrictions on transfer and an option to purchase set forth in a
certain stock option agreement. Such agreement is available for
inspection without charge at the office of the Secretary of the
Company.
-2-
<PAGE>
(j) The certificates evidencing the Shares shall also bear any legend
required by any applicable state securities law.
(k) In addition, the Company shall make a notation regarding the
restrictions on transfer of the Shares in its stock books, and the Shares shall
be transferred on the books of the Company only if transferred or sold pursuant
to an effective registration statement under the 1933 Act and applicable state
securities laws covering such Shares or pursuant to and in compliance with the
provisions of the stock option agreement referenced above. A copy of this
Agreement, together with any amendments thereto, shall remain on file with the
Secretary of the Company and shall be available for inspection to any properly
interested person without charge within five (5) days after the Company's
receipt of a written request therefor.
Very truly yours,
-3-
<PAGE>
WEBSPECTIVE SOFTWARE, INC.
Non-Qualified Stock Option Agreement
------------------------------------
Option Number: NQO-____
Specific Terms of the Option
- ----------------------------
Subject to the terms and conditions hereinafter set forth and the terms and
conditions of the WebSpective Software, Inc. 1997 Stock Option Plan (the
"Plan"), WebSpective Software, Inc. (formerly, Atreve Software, Inc.), a
----
Delaware corporation (the "Company"), hereby grants the following option (the
-------
"Option") to purchase Common Stock, par value $.01 per share (the "Common
- ------- ------
Stock"), of the Company:
- -----
1. Name of Person to Whom the Option is granted (the "Optionee"): [_________].
--------
2. Date of Grant of Option (the "Grant Date"): [_________].
----------
3. Number of shares of Common Stock issuable under the Option (the "Option
------
Shares"): [_________] shares, subject to adjustment as provided herein and in
- ------
the Plan.
4. Option exercise price per Option Share (the "Exercise Price"): [$_____],
--------------
subject to adjustment as provided herein and in the Plan.
5. Term of Option: Subject to Section 11 and Section 18(e) below, this Option
shall terminate at 5:00 p.m., Boston Time, on [___________].
6. Vesting Start Date: [_________].
6A. Initial Date of Optionee's Business Relationship with the Company:
[_________] (the "Start Date").
----------
7. Acknowledgment: By executing below, the Optionee acknowledges and agrees
that he or she has received a copy of the Plan, and that this Option is subject
to the terms and conditions set forth in the Plan and the terms and conditions
set forth in these Specific Terms of the Option and the attached Other Terms of
the Option, including, without limitation, the restrictions on transfer,
repurchase rights and other restrictions set forth herein and therein.
IN WITNESS WHEREOF, the Company and the Optionee have entered into this
Option Agreement (including the attached Other Terms of the Option) as an
instrument under seal as of the Grant Date.
WEBSPECTIVE SOFTWARE, INC.
By:____________________________ X______________________________
Name: (Signature of Optionee)
Title:
Print Name:____________________
Date:__________________________
Optionee's Address:
_______________________________
_______________________________
_______________________________
<PAGE>
Other Terms of the Option
- -------------------------
WHEREAS, the Optionee has rendered and/or will render services to the
Company or a Related Corporation as an employee, officer, director or consultant
(such services being referred to herein as maintaining or being involved in a
"Business Relationship with the Company");
- ---------------------------------------
WHEREAS, in accordance with and subject to the terms set forth herein and
in the immediately preceding Specific Terms of the Option (the "Specific
--------
Terms"), the Company desires to grant to the Optionee the Option pursuant to the
- -----
terms of the Plan (capitalized terms used herein, unless otherwise defined
herein, have the meanings ascribed to them in the Plan); and
WHEREAS, in accordance with Section 5 of the Plan, these Other Terms of the
Option, together with the Specific Terms, set forth the terms and conditions of
the Option;
NOW THEREFORE, in consideration of the premises and of the mutual covenants
and agreements contained herein, the Company and the Optionee hereby agree as
set forth in the Specific Terms and as follows:
8. Grant of Option. Pursuant to and subject to the Plan, the Company
---------------
hereby grants to the Optionee the Option to purchase from the Company all or any
part of the Option Shares as set forth in Section 3 of the Specific Terms,
subject to adjustment as provided herein and in the Plan, upon the terms and
conditions set forth in the Plan and upon the additional terms and conditions
hereinafter set forth.
9. Exercise Price. The exercise price per share for the Option Shares
--------------
shall be the Exercise Price as set forth in Section 4 of the Specific Terms,
subject to adjustment as provided herein and in the Plan.
10. Rights to Exercise. The Option shall be immediately exercisable with
------------------
respect to all of the Option Shares as of the Grant Date.
11. Term of Options; Exercisability.
-------------------------------
(a) Term.
----
(1) The Option shall expire ten (10) years from the Grant Date,
but shall be subject to earlier termination as herein provided.
(2) If the Optionee's Business Relationship with the Company
and all Related Corporations is terminated, for any reason or no
reason, then, subject to Sections 11(a)(3), 11(a)(4) and 11(a)(5)
below, the Option shall terminate on the earlier of (X) thirty
days following the date the Optionee's Business Relationship is
terminated, or (Y) on the date on which the Option expires by its
terms in accordance with section 11(a)(1) above.
(3) If the Optionee is employed with the Company or a Related
Corporation and such employment is terminated because the
Optionee has become permanently disabled (within the meaning of
Section 22(e)(3) of the Code), the
<PAGE>
Option shall terminate on the earlier of (X) the last day of the
sixth month from the date the Optionee ceases to be an employee
of the Company, or (Y) on the date on which the Option expires by
its terms, in accordance with Section 11(a)(1) above.
(4) If the Optionee is employed with the Company or a Related
Corporation and such employment is terminated because of the
death of the Optionee, the Option shall terminate on the earlier
of (X) the last day of the twelfth month from the date of death,
or (Y) on the date on which the Option expires by its terms, in
accordance with Section 11(a)(1) above.
(5) If the Optionee's Business Relationship with the Company is
terminated by the Company for Cause (as defined herein), the
Option shall terminate immediately on the date of such
termination.
(b) Definition of Cause. For purposes hereof, "Cause" shall mean
------------------- -----
conduct involving one or more of the following: (i) disloyalty, gross
negligence, willful misconduct, dishonesty or breach of fiduciary duty to the
Company or Related Corporation, if such disloyalty, gross negligence, willful
misconduct, dishonesty or breach of fiduciary duty is materially detrimental to
the interests of the Company or Related Corporation; (ii) the commission of an
act of embezzlement or fraud that is materially detrimental to the interests of
the Company or Related Corporation; (iii) deliberate disregard of the rules or
policies of the Company or Related Corporation which results in material loss,
damage or injury to the Company or Related Corporation; (iv) the willful,
unauthorized disclosure of any material trade secret or confidential
information of the Company or Related Corporation; or (v) the commission of an
act which constitutes unfair competition with the Company or Related Corporation
or which induces any customer or supplier to breach a contract with the Company
or Related Corporation and which is materially detrimental to the interests of
the Company or Related Corporation.
12. Manner and Exercise of Option.
-----------------------------
(a) The Option may be exercised in full or in part by giving written
notice to the Company stating the number of Option Shares for which the Option
is being exercised and accompanied by payment in full of the Exercise Price with
respect to such Option Shares. Such notice shall be signed by the person or
persons so exercising this Option. Payment of the Exercise Price for such
Option Shares may be made in the following manner: (i) wholly in cash or by
check payable to the Company; (ii) by delivery of an assignment satisfactory in
form and substance to the Company of a sufficient amount of the proceeds from
the sale of the Option Shares and an instruction to the broker or selling agent
to pay that amount to the Company; or (iii) by any combination of the foregoing.
Upon such exercise, delivery of a certificate for fully paid, non-assessable
Option Shares shall be made at the principal office of the Company to the person
exercising the Option, promptly following receipt of the notice by the Company.
(b) The Company shall at all times during the term of the Option
reserve and keep available such number of Option Shares as will be sufficient to
satisfy the requirements of the Option. The Optionee shall not have any of the
rights of a stockholder of the Company in respect of the Option Shares until one
or more certificates for such Option Shares shall be issued by the Company upon
the due exercise of the Option.
13. Non-Transferability of the Option and the Option Shares. (a) The
-------------------------------------------------------
right of the Optionee to exercise the Option shall not be assignable or
transferable by the Optionee otherwise than by will or
-2-
<PAGE>
the laws of descent and distribution. The Option may be exercised during the
lifetime of the Optionee only by the Optionee. The Option shall be null and void
and without effect upon the bankruptcy of the Optionee or upon any attempted
assignment or transfer, including without limitation any purported assignment,
whether voluntary or by operation of law, pledge, hypothecation or other
disposition contrary to the provisions hereof, or levy of execution, attachment,
trustee process or similar process, whether legal or equitable, upon the Option.
(b) Except for the transfer of the Covered Shares (as defined herein)
to the Company or its assignees as contemplated by this Agreement, none of the
Unreleased Shares or any beneficial interest therein shall be transferred,
pledged, encumbered or otherwise disposed of in any way until the release of
such Shares from the Company's Repurchase Right in accordance with the
provisions of this Agreement. In addition, the Optionee shall not sell, assign,
transfer, pledge, hypothecate, mortgage or dispose of, by gift or otherwise, or
in any way encumber, all or any part of the Released Shares that have been
issued upon exercise of the Option, except in compliance with this Agreement,
including, without limitation, in compliance with the following restrictions:
(i) the Company's right of repurchase set forth in Section 18, (ii) the
Optionee's agreement to lock-up the Option Shares for a period of at least 180
days after the consummation of an underwritten public offering of Common Stock
set forth in Section 22 and (iii) the right of first refusal in favor of the
Company set forth in Section 17; provided, however, that the restrictions
-------- -------
described in clause (iii) above shall not apply to transfers in compliance with
the provisions of Section 21 (Permitted Transfers).
14. Representation Letter and Legends.
---------------------------------
(a) In the event that for any reason the Option Shares to be issued
upon exercise of the Option shall not be effectively registered under the
Securities Act of 1933 (the "1933 Act"), upon any date on which the Option so
--------
exercised in whole or in part, the person exercising the Option shall give a
written representation to the Company in the form attached hereto as Exhibit 1
---------
and the Company shall place an "investment legend," so-called, as described in
Exhibit 1, upon any certificate for the Option Shares issued by reason of such
- ---------
exercise. In addition, each certificate evidencing any of the Option Shares
shall bear a legend substantially as follows:
"The shares represented by this certificate are subject to
restrictions on transfer (including a right of repurchase in favor of the
Company) and may not be sold, exchanged, transferred, pledged, hypothecated or
otherwise disposed of except in accordance with and subject to all the terms and
conditions of a certain stock option agreement, a copy of which the Company will
furnish to the holder of this certificate upon request and without charge."
(b) The Company shall be under no obligation to qualify Option Shares
or to cause a registration statement or a post-effective amendment to any
registration statement to be prepared for the purposes of covering the issuance
of the Option Shares.
15. Recapitalization, Reorganizations, Changes in Control and the Like.
------------------------------------------------------------------
Except as otherwise set forth herein, adjustments and other matters relating to
the merger or consolidation of the Company with or into another entity shall be
made and determined in accordance with Section 11 of the Plan, as in effect on
the date of this Agreement.
16. No Rights to Employment. Neither the Plan, this Agreement nor the
-----------------------
grant of this Option imposes any obligation on the Company or a Related
Corporation to employ the Optionee.
-3-
<PAGE>
17. Company's Right of First Refusal.
--------------------------------
(a) Exercise of Right. If at any time the Optionee or his or her
-----------------
legal representative (the "Transferor") desires to transfer all or any part of
----------
the Option Shares to any person other than the Company (an "Offeror"), the
-------
Transferor shall: (i) obtain in writing an irrevocable and unconditional bona
fide offer (the "Offer") for the purchase thereof from the Offeror; and (ii)
-----
give written notice (the "Option Notice") to the Company setting forth the
-------------
Optionee's desire to transfer such shares, which Option Notice shall be
accompanied by a photocopy of the Offer. The Option Notice must specify the
name and address of the Offeror, the number of Option Shares subject to such
Offer, the terms and conditions (including price) of the proposed transfer and
any other material facts relating to the proposed transfer. Upon receipt of the
Option Notice, the Company shall have an assignable option to purchase any or
all of such shares (the "Company Option Shares") specified in the Option Notice,
---------------------
such option to be exercisable by giving, within 30 days after receipt of the
Option Notice, a written counter-notice to the Transferor. If the Company
elects to purchase any or all of such Company Option Shares, it shall be
obligated to purchase, and the Transferor shall be obligated to sell to the
Company, such Company Option Shares at the price per share and on the other
terms and conditions, including deferred payment (if applicable), indicated in
the Option Notice within 30 days from the date of delivery by the Company of
such counter-notice. To the extent the consideration proposed to be paid by the
Offeror for the Offered Shares consists of property other than cash or a
promissory note, the consideration to be paid by the Company exercising its
option under this Section may, at the option of the Company, consist of cash
equal to the value of such property, as determined in good faith by the Board of
Directors of the Company.
(b) Sale of Option Shares to Offeror. The Transferor may, for 60 days
--------------------------------
after the expiration of the 30-day period during which the Company may give the
counter-notice, sell, pursuant to the terms of the Offer, any or all of such
Company Option Shares not purchased or agreed to be purchased by the Company or
its assignee; provided, however, that the Transferor shall not sell such Company
-------- -------
Option Shares to the Offeror if the Offeror is a competitor of the Company and
the Company gives written notice to the Transferor, within 30 days of its
receipt of the Option Notice, stating that the Transferor shall not sell such
Company Option Shares to such Offeror; and provided, further, that prior to the
-------- -------
sale of such Company Option Shares to the Offeror, the Offeror shall execute an
agreement with the Company pursuant to which the Offeror agrees to be subject to
the restrictions set forth in this Agreement. If any or all of such Company
Option Shares are not sold pursuant to an Offer within the time permitted above,
the unsold Company Option Shares shall remain subject to the terms of this
Section 17.
(c) Expiration of Company's Right of First Refusal and Transfer
-----------------------------------------------------------
Restrictions. The transfer restrictions set forth in this Section 17 (Company's
- ------------
Right of First Refusal) shall remain in effect until such time, if ever, as a
distribution to the public is made of shares of Common Stock pursuant to a
registration statement filed under the 1933 Act or a successor statute, at which
time the transfer restrictions set forth in this section 17 will automatically
terminate.
18. Company's Right of Repurchase.
-----------------------------
(a) Unreleased or Released Shares. At any time when the Repurchase
-----------------------------
Right (as defined below) of the Company is in effect, the Option Shares which
are not yet released as of such time from the Repurchase Right pursuant to
Section 18(d) shall be referred to herein as "Unreleased Shares" and the Option
-----------------
Shares which are released as of such time pursuant to Section 18(d) shall be
referred to herein as "Released Shares." The term "Option Shares" used without
--------------- -------------
reference to either Unreleased
-4-
<PAGE>
Shares or Released Shares shall mean both the Unreleased Shares and the Released
Shares, without distinction.
(b) Right of Repurchase. The Company shall have the right (the
-------------------
"Repurchase Right") to repurchase from the holder of this Option, all or any
- -----------------
portion of the Covered Shares (as defined below) upon the occurrence of any of
the events specified in Section 18(c) below (a "Repurchase Event"), at the
----------------
Exercise Price per Covered Share. The Repurchase Right may be exercised by the
Company within 90 days following the later of the date of the exercise of this
Option or the date the Company receives actual knowledge of a Repurchase Event
(the "Repurchase Period"). The Repurchase Right shall be exercised by the
-----------------
Company by giving the holder written notice on or before the last day of the
Repurchase Period of its intention to exercise the Repurchase Right, which
notice shall specify the number of Covered Shares to be so repurchased, and,
together with such notice, tendering to the holder an amount equal to Exercise
Price for each Covered Share to be so repurchased (such date and time of
exercise being referred to herein as the "Company Exercise Date"). Upon
---------------------
exercise of the Repurchase Right in the manner provided in this Section 18(b),
the holder shall deliver to the Company, within ten (10) days of receipt of the
Company's notice of such repurchase, the stock certificate or certificates
representing the Option Shares being repurchased, duly endorsed and free and
clear of any and all liens, charges and encumbrances. If Covered Shares are not
repurchased under the Repurchase Right, the Optionee and his or her successor in
interest, if any, will hold any such shares in his or her possession subject to
all of the provisions of this Agreement. For purposes hereof, the term "Covered
-------
Shares" shall mean the number of Option Shares equal to the difference between
- ------
(i) the number of Option Shares for which the Option has been exercised as of
the Company Exercise Date minus (ii) the number of Released Shares as of the
-----
Company Exercise Date; provided, however, that the number of Covered Shares
-------- -------
shall not be less than zero.
(c) Company's Right to Exercise Repurchase Right. The Company shall
--------------------------------------------
have the Repurchase Right in the event that any of the following events shall
occur:
(i) The termination of the Optionee's Business Relationship with the
Company, voluntarily or involuntarily, for any reason
whatsoever;
(ii) The receivership, bankruptcy or other creditor's proceeding
regarding the Optionee or the taking of any of the Optionee's
shares acquired upon exercise of this option by legal process,
such as a levy of execution; or
(iii) Distribution of shares held by the Optionee to his or her spouse
as such spouse's joint or community interest pursuant to a
decree of dissolution, operation of law, divorce, property
settlement agreement or for any other reason, except as may be
otherwise permitted by the Company.
(d) Release of Option Shares from Repurchase Right. As of the
----------------------------------------------
Vesting Start Date set forth in Section 6 of the Specific Terms (the "Vesting
-------------
Start Date") all of the Option Shares shall be deemed to be Unreleased Shares.
To the extent provided herein, the Option Shares, together with any additional
rights or shares attributable to such Option Shares, will be released from the
Repurchase Right and shall be deemed to be Released Shares as follows:
(i) If the Optionee has had a Business Relationship with the Company
for less than one year as of the Vesting Start Date, a number of
Option Shares equal to the product (rounded down) of (A) the
Initial Vesting Percentage (as defined below)
-5-
<PAGE>
multiplied by (B) the total number of Option Shares, shall be
---------- --
released from the Repurchase Right on the first anniversary of
the Start Date. In addition, commencing on the thirtieth day
after the first anniversary of the Start Date and on the last day
of each successive 30-day period thereafter, a number of Option
Shares equal to the quotient (rounded down) of (A) the total
number of Option Shares divided by (B) 48, shall be released
------- --
from the Repurchase Right.
(ii) If the Optionee has had a Business Relationship with the Company
for one year or more as of the Vesting Start Date, then
commencing on the thirtieth day after the Vesting Start Date and
on the last day of each successive 30-day period thereafter, a
number of Option Shares equal to the quotient (rounded down) of
(A) the total number of Option Shares divided by (B) 48, shall
------- --
be released from the Repurchase Right.
(iii) From and after the occurrence of a Change in Control (as defined
below), the total number of Option Shares released from the
Repurchase Right as of a particular date shall be equal to the
total number of Option Shares that would otherwise have been
released pursuant to this Section 18(d) without giving effect to
this Section 18(d)(iii) on the date that is 420 days after such
date.
(iv) The balance of the Unreleased Shares shall be released from the
Repurchase Option on the fourth anniversary of the Vesting Start
Date.
For purposes hereof, the following terms shall have the following
meanings:
The term "Change in Control" shall mean the closing of (i) a sale
-----------------
by the Company of all or substantially all of its assets, (ii) the acquisition
in a single transaction, or a series of related transactions, of shares of
capital stock of the Company representing at least a majority of the issued and
outstanding shares of capital stock of the Company (measured on the basis of
voting power) by a person (as defined in Section 13(d) of the Exchange Act), or
(iii) a merger or consolidation of the Company with or into another entity in a
transaction where the shares of the Company's capital stock outstanding
immediately prior to the closing of such merger or consolidation represent or
are converted into or exchanged for shares that represent less than a majority
of the shares of capital stock of the resulting or surviving entity outstanding
immediately after the closing of such merger or consolidation.
The term "Initial Vesting Percentage" shall mean a percentage
--------------------------
equal to the quotient obtained by dividing (A) the number of complete 30-day
periods that have elapsed from the Vesting Start Date through the first
anniversary of the Start Date by (B) forty-eight (48); provided, however, if the
-- -------- -------
Optionee's Vesting Start Date and Start Date are the same, the Initial Vesting
Percentage shall be equal to twenty-five percent (25%).
(e) Partial Exercise. The number of shares for which this Option
----------------
shall be exercisable from and after the Company Exercise Date shall be reduced
by, and the Option shall no longer be exercisable for, the number of Option
Shares equal to the difference between (i) the number of Unreleased Shares as of
the Company Exercise Date minus (ii) the number of Covered Shares as of the
Company Exercise Date (such difference being referred to herein as the
"Remaining Shares"). Notwithstanding anything to the contrary contained herein
- -----------------
or in the Option Agreement, if, upon the occurrence of any Company Exercise
Date, the number of Remaining Shares is zero or less, then the Option shall
immediately terminate.
-6-
<PAGE>
(f) Example. By way of illustration only (assuming (i) the Optionee
-------
was granted an Option to purchase 1,000 Option Shares on December 1, 1999 (such
Optionee's Start Date), (ii) the Vesting Start Date for such Optionee was
December 1, 1999 and (iii) such Optionee was involved in a Business Relationship
with the Company through January 1, 2001 at which time a Change in Control
occurred), the Option Shares relating to an Option would be released from the
Repurchase Right as follows:
1. On December 1, 2000, 250 Option Shares would be released
from the Repurchase Right;
2. On December 31, 2000, an additional 20 shares would be
released from the Repurchase Right; and
3. On January 1, 2001 (the occurrence of such Change in
Control) an additional 280 shares would be released from the
Repurchase Right.
19. Adjustments for Changes in Capital Structure. If there shall be any
--------------------------------------------
change in the Common Stock of the Company through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split, combination or
exchange of shares, or the like, the restrictions contained in this Agreement
(including the right of repurchase in favor of the Company contained in Section
18) shall apply with equal force to additional and/or substitute securities, if
any, received by the Optionee in exchange for, or by virtue of his or her
ownership of, Option Shares, except as otherwise determined by the Board of
Directors of the Company.
20. Failure to Deliver Company Option Shares. If the Transferor fails or
----------------------------------------
refuses to deliver on a timely basis duly endorsed certificates representing
Option Shares to be sold to the Company or its assignee pursuant to Section 17
or Section 18, the Company shall have the right to deposit the purchase price
for such Option Shares in a special account with any bank or trust company in
the Commonwealth of Massachusetts, giving notice of such deposit to the
Transferor, whereupon such Option Shares shall be deemed to have been purchased
by the Company. All such monies shall be held by the bank or trust company for
the benefit of the Transferor. All monies deposited with the bank or trust
company remaining unclaimed for two years after the date of deposit shall be
repaid by the bank or trust company to the Company on demand, and the Transferor
shall thereafter look only to the Company for payment.
21. Permitted Transfers. Anything herein to the contrary notwithstanding,
-------------------
the provisions of Sections 13(b), 17 and 18 shall not apply to: (a) any
transfer of Released Shares that have been issued upon exercise of the Option by
gift or bequest or through inheritance to, or for the benefit of, any member or
members of the Optionee's immediate family; or (b) any transfer of Released
Shares by the Optionee by way of gift for estate planning purposes to a trust
for the benefit of the Optionee or any member of his or her immediate family. In
the event of any such transfer, prior to and as a condition precedent to such
transfer, the transferee of such Released Shares shall provide the Company with
a written agreement to be bound by the terms of this Agreement to the same
extent as the Optionee, and such transferee shall hold the Released Shares so
acquired with all the rights conferred by, and subject to all the restrictions
imposed by, this Agreement.
22. Lock-up Agreement. The Optionee agrees that in connection with an
-----------------
underwritten public offering of Common Stock, upon the request of the Company or
the principal underwriter managing such public offering, the Option Shares may
not be sold, offered for sale or otherwise disposed
-7-
<PAGE>
of without the prior written consent of the Company or such underwriter, as the
case may be, for at least 180 days after the consummation of such offering, or
such longer period of time as the Board of Directors may determine if all of the
Company's directors and officers agree to be similarly bound. The obligations
under this Section 22 shall remain effective for all underwritten public
offerings with respect to which the Company has filed a registration statement
on or before the date five (5) years after the closing of the Company's initial
public offering; provided, however, that this Section 22 shall cease to apply to
-------- -------
any Option Share sold to the public pursuant to an effective registration
statement or sold to the public pursuant to an exemption from the registration
requirements of the Securities Act of 1933 in a transaction that complied with
the terms of this Agreement.
23. Section 83(b) Election. In order to ensure that the tax consequences
----------------------
of such exercise will be determined at the time of exercise, Optionee agrees to
file a timely election under Section 83(b) of the Code to include in Optionee's
taxable income, at the time of exercise, the difference between the fair market
value of the Option Shares received upon exercise of this option and the amount
paid for such shares; provided, however, that the Board, in its sole and
-------- -------
absolute discretion, may waive the requirement that the Optionee file such
election.
24. Withholding Taxes. The Company shall have the right to withhold (or
-----------------
to cause a Related Corporation to withhold) from compensation otherwise payable
to the Optionee, or to require the Optionee to remit to the Company an amount
sufficient to satisfy all federal, state and local withholdings tax requirements
in respect of the Option Shares being purchased by the Optionee prior to the
issuance of such Option Shares and the delivery of any certificate or
certificates for such Option Shares or the payment of any consideration
specified in Section 13 of the Plan, and from time to time thereafter as a
result of any reason whatsoever.
25. Amendment and Waiver. This Agreement may be amended, modified or
--------------------
supplemented, and waivers or consents to departures from the provisions hereof
may be given, provided that the same are in writing and signed by the parties.
26. Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with, the General Corporation Law of the State of
Delaware as to matters within the scope thereof and, as to all other matters,
shall be governed by and construed and enforced in accordance with the internal
laws of the Commonwealth of Massachusetts without regard to principles of
conflicts of laws.
27. Notices. Any notices or other communications required to be given
-------
hereunder shall be given by hand delivery or by first class mail with all fees
prepaid and addressed, if to the Company, to it at 66 B Street, Needham,
Massachusetts 02194 Attn: President, and if to Optionee, to him at the address
set forth in the signature page hereto.
-8-
<PAGE>
EXHIBIT 1
TO STOCK OPTION AGREEMENT
[Date]
-------------
WebSpective Software, Inc.
66 B Street
Needham, MA 02194
Gentlemen:
In connection with the acquisition by me of ______ shares of common stock,
$.01 par value per share (the "Shares"), of WebSpective Software, Inc., a
------
Delaware corporation (the "Company"), I hereby represent to the Company as
-------
follows:
(a) I hereby confirm that: (i) the Shares to be received by me will be
acquired for investment only, for my own account, not as a nominee or agent and
not with a view to the sale or distribution of any part thereof; and (ii) I have
no current intention of selling, granting participation in or otherwise
distributing the Shares. I further represent that I do not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
participation to such person, or to any third person, with respect to any of the
Shares.
(b) I understand that the Shares have not been registered under the
Securities Act of 1933 (the "1933 Act") on the basis that the acquisition of the
--------
Shares by me and the issuance of securities by the Company to me is exempt from
registration under the 1933 Act and that the Company's reliance on such
exemption is predicated on my representations set forth herein.
(c) I represent that I have, either alone or together with the assistance
of a "purchaser representative" (as that term is defined in Regulation D
promulgated under the 1933 Act), such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of my
investment in the Company. I further represent that I am familiar with the
business and financial condition, properties, operations and prospects of the
Company. I further represent that I have had, prior to my acquisition of the
Shares, the opportunity to ask questions of, and receive answers from, the
Company concerning the terms and conditions of the issuance and to obtain
information (to the extent the Company possessed such information or could
acquire it without unreasonable effort or expense) necessary to verify the
accuracy of any information furnished to me or to which I have had access. I am
satisfied that there is no material information concerning the condition,
properties, operations and prospects of the Company of which I am unaware. I
have made, either alone or together with my advisors, such independent
investigation of the Company as I deem to be, or my advisors deem to be,
necessary or advisable in connection with this investment.
<PAGE>
(d) I understand that the Shares may not be sold, transferred or otherwise
disposed of without registration under the 1933 Act and applicable state
securities laws, or an exemption therefrom, and that in the absence of an
effective registration statement covering the Shares or an available exemption
from registration under the 1933 Act or applicable state securities laws, the
Shares must be held indefinitely. In particular, I acknowledge that I am aware
that the Shares may not be sold pursuant to Rule 144 promulgated under the 1933
Act unless all of the conditions of that Rule are met. Among the current
conditions for use of Rule 144 by certain holders is the availability to the
public of current information about the Company. Such information is not now
available, and the Company has no current plans to make such information
available. I represent that, in the absence of an effective registration
statement covering the Shares or an available exemption from registration under
the 1933 Act or applicable state securities laws, I will not sell, transfer or
otherwise dispose of the Shares.
(e) I represent that I (i) am capable of bearing the economic risk of
holding the unregistered Shares for an indefinite period of time and have
adequate means for providing for my current needs and contingencies, (ii) can
afford to suffer a complete loss of my investment in the Shares, and (iii)
understand and have taken cognizance of all risk factors related to the
acquisition of the Shares.
(f) I understand that the acquisition of the Shares involves a high degree
of risk and there is no established market for the Company's capital stock and
it is not likely that any public market for such stock will develop in the near
future.
(g) I represent that neither I nor anyone acting on my behalf has paid any
commission or other remuneration to any person in connection with the
acquisition of the Shares.
(h) Independent of the additional restrictions on the transfer of the
Shares contained herein, I agree that I will not make a transfer, disposition or
pledge of any of the Shares other than pursuant to an effective registration
statement under the 1933 Act and applicable state securities laws, unless and
until: (i) I shall have notified the Company of the proposed disposition and
shall have furnished the Company with a statement of the circumstances
surrounding the disposition and (ii) if requested by the Company and at my
expense or at the expense of my transferee, I shall have furnished to the
Company an opinion of counsel, reasonably satisfactory (as to counsel and as to
substance) to the Company and its counsel, to the effect that such transfer may
be made without registration of the Shares under the 1933 Act, and applicable
state securities laws.
(i) I acknowledge that all certificates evidencing the Shares shall bear a
legend in substantially the following form:
"TRANSFER RESTRICTED"
-------------------
The shares represented by this certificate have not been registered
under the Securities Act of 1933 and applicable state securities laws.
These shares have been acquired for investment and not with a view to
distribution or resale, and may not be sold, mortgaged, pledged,
hypothecated or otherwise transferred without an effective
registration statement for such shares under the Securities Act of
1933 and applicable state securities laws, or an opinion of counsel
satisfactory to the Company that registration is not required under
such Act and applicable state securities laws.
-2-
<PAGE>
The shares of stock represented by this certificate are subject to
restrictions on transfer and an option to purchase set forth in a
certain stock option agreement. Such agreement is available for
inspection without charge at the office of the Secretary of the
Company.
(j) The certificates evidencing the Shares shall also bear any legend
required by any applicable state securities law.
(k) In addition, the Company shall make a notation regarding the
restrictions on transfer of the Shares in its stock books, and the Shares shall
be transferred on the books of the Company only if transferred or sold pursuant
to an effective registration statement under the 1933 Act and applicable state
securities laws covering such Shares or pursuant to and in compliance with the
provisions of the stock option agreement referenced above. A copy of this
Agreement, together with any amendments thereto, shall remain on file with the
Secretary of the Company and shall be available for inspection to any properly
interested person without charge within five (5) days after the Company's
receipt of a written request therefor.
Very truly yours,
-3-
<PAGE>
Exhibit 5.1
-----------
October 21, 1999
Inktomi Corporation
4100 E. Third Avenue
Foster City, CA 94404
Re: Registration Statement on Form S-8
----------------------------------
Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by you
with the Securities and Exchange Commission on or about October 22, 1999 (the
"Registration Statement") in connection with the registration under the
Securities Act of 1933, as amended, of an aggregate of 37,321 shares of your
Common Stock (the "Shares") under the WebSpective Software, Inc. (formerly
Atrieve Software, Inc.) 1997 Stock Option Plan (the "WebSpective Stock Plan ").
As your counsel in connection with this transaction, we have examined the
proceedings taken and are familiar with the proceedings proposed to be taken by
you in connection with the issuance and sale of the Shares pursuant to the
WebSpective Stock Plan.
It is our opinion that, when issued and sold in the manner described in the
WebSpective Stock Plan and pursuant to the agreements which accompany each grant
under the WebSpective Stock Plan, the Shares will be legally and 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 the use of our name wherever appearing in the
Registration Statement and any amendments thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
/S/ WILSON SONSINI GOODRICH & ROSATI
<PAGE>
Exhibit 23.2
------------
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We consent to the incorporation by reference in this Registration Statement on
Form S-8 (No. __________) of our report dated October 16, 1998 relating to the
financial statements, which appear in Inktomi Corporation's Annual Report on
Form 10-K for the year ended September 30, 1998.
PricewaterhouseCoopers LLP
/S/ PRICEWATERHOUSE COOPERS LLP
San Francisco, California
October 21, 1999
