<PAGE>
As filed with the Securities and Exchange Commission on March 9, 1998
Registration No. 333-________________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------------
GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
(Exact name of issuer as specified in its charter)
CALIFORNIA 94-3120525
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
1155 MARKET STREET SAN FRANCISCO, CALIFORNIA 94103
(Address of principal executive offices) (Zip Code)
------------------------
FORTE ADVANCED MANAGEMENT SOFTWARE, INC.
1996 STOCK PLAN
(Full title of the plans)
-----------------------
GREGORY SHENKMAN
PRESIDENT AND CHIEF EXECUTIVE OFFICER
GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
1155 MARKET STREET SAN FRANCISCO, CALIFORNIA 94103
(Name and address of agent for service)
(415) 437-1100
(Telephone number, including area code, of agent for service)
------------------------
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered(1) per Share(2) Price(2) Fee
- ------------------- ------------- ------------ ------------- ------------
<S> <C> <C> <C> <C>
1996 Stock Plan
- -------------------
Options to Purchase
Common Stock 90,349 N/A N/A N/A
Common Stock 90,349 $12.00 $1,084,188.00 $319.84
================================================================================
</TABLE>
(1) This Registration Statement shall also cover any additional shares of
Common Stock which become issuable under the Forte Advanced Management
Software, Inc. 1996 Stock Plan by reason of any stock dividend, stock
split, recapitalization or other similar transaction effected without the
receipt of consideration which results in an increase in the number of the
Registrant's outstanding shares of Common Stock.
(2) Calculated solely for purposes of this offering under rule 457(h) of the
Securities Act of 1933, as amended, on the basis of the weighted average
exercise price of the options.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
---------------------------------------
Genesys Telecommunications Laboratories, Inc. (the "Registrant") hereby
incorporates by reference into this Registration Statement the following
documents previously filed with the Securities and Exchange Commission (the
"SEC"):
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1997 filed with the Commission on September 29, 1997
pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended (the "1934 Act").
(b) (1) The Registrant's Quarterly Reports on Form 10-Q for the fiscal
quarters ended September 30, 1997 and December 31, 1997, filed
with the Commission on November 14, 1997 and February 17, 1998,
respectively.
(2) The Registrant's report on Form 8-K filed with the Commission
on January 15, 1998.
(c) The Registrant's Registration Statement No. 000-22605 on Form 8-A
filed with the Commission on May 27, 1997, pursuant to Section 12
of the 1934 Act, in which there is described the terms, rights and
provisions applicable to the Registrant's outstanding Common Stock.
All reports and definitive proxy or information statements filed
pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act after the date of
this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Registration Statement
to the extent that a statement contained herein or in any subsequently filed
document which also is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
Item 4. Description of Securities
-------------------------
Not Applicable.
Item 5. Interests of Named Experts and Counsel
--------------------------------------
Not Applicable.
Item 6. Indemnification of Directors and Officers
-----------------------------------------
The Registrant's Restated Articles of Incorporation, as amended, and
Amended and Restated Bylaws provide for indemnification of its directors,
officers, employees and other agents to the maximum extent permitted by the
California Corporations Code. This is intended to eliminate the personal
liability of a director for monetary damages in an action brought by or in the
right of the Registrant for breach of a director's duties to the Registrant or
its shareholders, except for liability: (1) for acts or omissions that involve
intentional misconduct or a knowing
<PAGE>
and culpable violation of law; (2) for acts or omissions that a director
believes to be contrary to the best interests of the Registrant or its
shareholders or that involve the absence of good faith on the part of the
director; (3) for any transaction from which a director derived an improper
personal benefit; (4) for acts or omissions that constitute an unexcused pattern
of inattention that amounts to an abdication of the director's duty to the
Registrant or its shareholders; (5) with respect to certain transactions, or the
approval of transactions, in which a director has a material financial interest;
and (6) with respect to approval of certain improper distributions to
shareholders or certain loans or guarantees.
In addition, the Registrant has entered into separate Indemnification
Agreements with each of its directors and officers. These agreements require
the Registrant to indemnify its officer and directors to the fullest extent
permitted by law, including circumstances in which indemnification would
otherwise be discretionary. Among other things, the agreements require the
Registrant to indemnify directors and officers against certain liabilities that
may arise by reason of their status or service as directors and officers and to
advance their expenses incurred as a result of any proceeding against them as to
which they could be indemnified.
Item 7. Exemption from Registration Claimed
-----------------------------------
Not Applicable.
Item 8. Exhibits
--------
Number Exhibit
------ -------
4.0 Instruments Defining Rights of Shareholders. Reference is made to
Registrant's Registration Statement No. 000-22605 on Form 8-A, which
is incorporated herein by reference pursuant to Item 3(c).
5.0 Opinion and consent of Brobeck, Phleger & Harrison LLP.
23.1 Consent of Arthur Andersen LLP, Independent Accountants.
23.2 Consent of Brobeck, Phleger & Harrison LLP is contained in Exhibit
5.
24.0 Power of Attorney. Reference is made to page II-4 of this
Registration Statement.
99.1 Forte Advanced Management Software, Inc. 1996 Stock Plan.
99.2 Form of Stock Option Agreement.
99.3 Form of Notice of Exercise.
99.4 Form of Stock Option Assumption Agreement.
Item 9. Undertakings
------------
A. The undersigned Registrant hereby undertakes: (1) to file, during
any period in which offers or sales are being made, a post-effective amendment
to this Registration Statement (i) to include any prospectus required by Section
10(a)(3) of the 1933 Act, (ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in this
Registration Statement and (iii) to include any material information with
respect to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information in this
Registration Statement; provided, however, that clauses (1)(i) and (1)(ii)
--------
shall not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the 1934 Act that are
incorporated by reference into this Registration Statement; (2) that for the
purpose of determining any liability under the 1933 Act each such post-effective
amendment shall be deemed to be a new
II-2
<PAGE>
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; and (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 Forte 1996 Stock Plan.
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the 1933 Act, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act that is
incorporated by reference into this 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. Insofar as indemnification for liabilities arising under the 1933
Act may be permitted to directors, officers, or controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that, in the opinion of the SEC, such indemnification is
against public policy as expressed in the 1933 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 1933 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, as amended, 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 San Francisco, State of California, on this
9th day of March, 1998.
GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
By: /s/ Gregory Shenkman
--------------------------------------------
Gregory Shenkman
President and Chief Executive Officer
POWER OF ATTORNEY
-----------------
KNOW ALL PERSONS BY THESE PRESENTS:
That the undersigned officers and director/s of Genesys Telecommunications
Laboratories, Inc., a California corporation, do hereby constitute and appoint
Gregory Shenkman and Alec Miloslavsky, and each of them, the lawful attorneys-
in-fact and agents with full power and authority to do any and all acts and
things and to execute any and all instruments which said attorneys and agents
determine may be necessary or advisable or required to enable said corporation
to comply with the Securities Act of 1933, as amended, and any rules or
regulations or requirements of the Securities and Exchange Commission in
connection with this Registration Statement. Without limiting the generality of
the foregoing power and authority, the powers granted include the power and
authority to sign the names of the undersigned officers and directors in the
capacities indicated below to this Registration Statement, to any and all
amendments, both pre-effective and post-effective, and supplements to this
Registration Statement, and to any and all instruments or documents filed as
part of or in conjunction with this Registration Statement or amendments or
supplements thereof, and the undersigned hereby ratifies and confirms that said
attorneys and agents shall do or cause to be done by virtue hereof. This Power
of Attorney may be signed in several counterparts.
IN WITNESS WHEREOF, each of the undersigned has executed this Power of
Attorney as of the date indicated.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Gregory Shenkman
- ---------------------------- President, Chief Executive Officer March 9, 1998
Gregory Shenkman and Director (Principal Executive
Officer)
/s/ Alec Miloslavsky
- ---------------------------- Vice Chairman, Chief Technical March 9, 1998
Alec Miloslavsky Officer and Director
II-4
<PAGE>
Signature Title Date
- --------- ----- ----
/s/ James Jordan
- --------------------------- Chairman of the Board and Director March 9, 1998
James Jordan
/s/ Michael J. McCloskey
- --------------------------- Vice President, Finance and March 9, 1998
Michael J. McCloskey International, Chief Financial
Officer and Secretary (Principal
Financial and Accounting Officer)
/s/ Bruce Dunlevie
- --------------------------- Director March 9, 1998
Bruce Dunlevie
/s/ Paul D. Levy
- --------------------------- Director March 9, 1998
Paul D. Levy
II-5
<PAGE>
EXHIBIT INDEX
-------------
Number Exhibit
------ -------
4.0 Instruments Defining Rights of Shareholders. Reference is made to
Registrant's Registration Statement No. 000-22605 on Form 8-A, which
is incorporated herein by reference pursuant to Item 3(c) of this
Registration Statement.
5.0 Opinion and consent of Brobeck, Phleger & Harrison LLP.
23.1 Consent of Arthur Andersen LLP, Independent Accountants.
23.2 Consent of Brobeck, Phleger & Harrison LLP is contained in Exhibit
5.
24.0 Power of Attorney. Reference is made to page II-4 of this
Registration Statement.
99.1 Forte Advanced Management Software, Inc. 1996 Stock Plan.
99.2 Form of Stock Option Agreement.
99.3 Form of Notice of Exercise.
99.4 Form of Stock Option Assumption Agreement.
<PAGE>
EXHIBIT 5
March 9, 1998
Genesys Telecommunications Laboratories, Inc.
1155 Market Street
San Francisco, CA 94103
Re: Registration Statement for Offering of 90,349 Shares of Common Stock
--------------------------------------------------------------------
Ladies and Gentlemen:
We refer to your Registration Statement on Form S-8 (the "Registration
Statement") under the Securities Act of 1933, as amended, of 90,349 shares of
the common stock ("Common Stock") of Genesys Telecommunications Laboratories,
Inc. (the "Company") issuable under the Forte Advanced Management Software, Inc.
1996 Stock Plan (the "Plan") as assumed by the Company. We advise you that, in
our opinion, when such shares have been issued and sold pursuant to the
applicable provisions of the Plan and in accordance with the Registration
Statement, such shares will be duly authorized, validly issued, fully paid and
non-assessable shares of the Company's Common Stock.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Brobeck, Phleger & Harrison LLP
BROBECK, PHLEGER & HARRISON LLP
<PAGE>
EXHIBIT 23.1
------------
Consent of Arthur Andersen LLP, Independent Accountants.
<PAGE>
EXHIBIT 23.2
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement on Form S-8 of our report dated July
14, 1997, included in the Genesys Telecommunications Laboratories Corporation's
Form 10-K as filed on September 29, 1997.
/s/ ARTHUR ANDERSEN LLP
-----------------------
ARTHUR ANDERSEN LLP
San Jose California
March 6, 1998
<PAGE>
EXHIBIT 99.1
FORTE ADVANCED MANAGEMENT SOFTWARE, INC.
1996 STOCK PLAN
ADOPTED JUNE 14, 1996
1. PURPOSES.
(a) The purpose of the Plan is provide a means by which selected Employees
and Directors of and Consultants to the Company, and its Affiliates, may be
given an opportunity to benefit from increases in value of the stock of the
Company through the granting of (i) Incentive Stock Options, (ii) Nonstatutory
Stock Options, (iii) stock bonuses, (iv) rights to purchase restricted stock,
and (v) stock appreciation rights, all as defined below.
(b) The Company, by means of the Plan, seeks to retain the services of
persons who are now Employees or Directors of or Consultants to the Company or
its Affiliates, to secure and retain the services of the new Employees,
Directors and Consultants, and the Company and its Affiliates.
(c) The Company intends that the Stock Awards issued under the Plan shall,
in the discretion of the Board or any Committee to which responsibility for
administration of the Plan has been delegated pursuant to subsection 3(c), be
either (i) Options granted pursuant to Section 6 hereof, including Incentive
Stock Options and Nonstatutory Stock Options, (ii) stock bonuses or rights to
purchase restricted stock granted pursuant to Section 7 hereof, or (iii) stock
appreciation rights granted pursuant to Section 8 hereof. All Options shall be
separate certificate or certificates will be issued for shares purchased on
exercise of each type of Option.
2. DEFINITIONS.
(a) "Affiliate" means any parent corporation or subsidiary corporation,
whether now or hereafter existing, as those terms are defined in Section 424(e)
and (f) respectively, of the Code.
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, amended.
(d) "Committee" means a Committee appointed by the Board in accordance with
subsection 3(c) of the Plan.
(e) "Company" means Forte Advanced Management Software, Inc., a California
corporation.
(f) "Concurrent Stock Appreciation Right" or "Concurrent Right" means a
right granted pursuant to subsection 8(b)(2) of the Plan.
(g) "Consultant" means any person, including an advisor, engaged by the
Company or an Affiliate to render consulting services and who is compensated for
such services, provided that the term "Consultant" shall not include Directors
who are paid only a director's fee by the Company or who are compensated by the
Company for their services as Directors.
<PAGE>
(h) "Continuous Status as an Employee, Director or Consultant" means the
employment or relationship as a Director or Consultant is not interrupted or
terminated. The Board, in its sole discretion, may determine whether Continuous
Status as an Employee, Director or Consultant shall be considered interrupted in
the case of: (i) any leave of absence approved by the Board, including sick
leave, military, or any other personal leave; or (ii) transfer between locations
of the Company or between the Company, Affiliates or their successors.
(i) "Director" means a member of the Board.
(j) "Disinterested Person" means a Director: who either (i) was not during
the one year prior to service as an administrator of the Plan granted or awarded
equity securities pursuant to the Plan or any other plan of the Company or any
Affiliate entitling the participants therein to acquire equity securities of the
Company or any Affiliate except as permitted by Rule 16b-3(c)(2)(i); or any
other applicable rules, regulations or interpretations of the Securities and
Exchange Commission.
(k) "Employee" means any person, including Officers and Directors, employed
by the Company or any Affiliates of the Company. Neither service as a Directors
nor payment of the director's fee by the Company shall be sufficient to
constitute "employment" by the Company.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(m) "Fair Market Value" means the value of the common stock of the Company
as determined in good faith by the Board and in a manner consistent with Section
260.140.50 of Title 10 of the California Code of Regulations.
(n) "Incentive Stock Option" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.
(o) "Independent Stock Appreciation Right" or "Independent Right" means a
right granted pursuant to subsection 8(b)(3) of the Plan.
(p) "Nonstatutory Stock Option" means an Option not intended to qualify as
an Incentive Stock Option.
(q) "Officer" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchanged Act and the rules and regulations
promulgated thereunder.
(r) "Option" means a stock option granted pursuant to the Plan.
(s) "Option Agreement" means a written agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant.
Each Option Agreement shall be subject to the terms and conditions of the Plan.
(t) "Optionee" means an Employee, Director or Consultant who holds an
outstanding Option.
2
<PAGE>
(u) "Plan" means this 1996 Stock Plan.
(v) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor to
Rule 16b-3, as in effect when discretion is being exercised with respect to the
Plan.
(w) "Stock Appreciation Right" means any of the various types of rights
which may be granted under Section 8 of the Plan.
(x) "Stock Award" means any right granted under the Plan, including any
Option, any stock bonus, any right to purchase restricted stock, and any Stock
Appreciation Right.
(y) "Stock Award Agreement" means a written agreement between the Company
and holder of the Stock Award evidencing the terms and condition of an
individual Stock Award grant. Each Stock Award Agreement shall be subject to
the terms and conditions of the Plan.
(z) "Tandem Stock Appreciation Right" or "Tandem Right" means a right
granted pursuant to subsection 8(b)(1) of the Plan.
3. ADMINISTRATION.
(a) The Plan shall be administered by the Board unless and until the Board
delegates administration to a Committee, as provided in subsection 3(c).
(b) The Board shall have the power, subject to and within the limitations
of, the express provisions of the Plan:
(1) To determine from time to time which of the persons eligible under
the Plan shall be granted Stock Awards; when and how each Stock Award shall be
granted; whether a Stock Award will be an Incentive Stock Option, a Nonstatutory
Stock Option, a stock bonus, right to purchase restricted stock, a Stock
Appreciation Right, or a combination of the foregoing; the provisions of each
Stock Award granted (which need not be identical), including the time or times
when a person shall be permitted to receive stock pursuant to a Stock Award;
whether a person shall be permitted to receive stock upon exercise of an
Independent Stock Appreciation Right; and the number of shares with respect to
which a Stock Award shall be granted to each such person.
(2) To construe and interpret the Plan and Stock Awards granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Stock Award Agreement,
in a manner and to the extent it shall deem necessary or expedient to make the
Plan fully effective.
(3) To amend the Plan or a Stock Award as provided in Section 14.
(4) Generally, to exercise such powers and to perform such acts as the
Board deems necessary or expedient to promote the best interests of the Company
which are not conflict with the provisions of the Plan.
3
<PAGE>
(c) The Board may delegate administration of the Plan to a committee
composed of not fewer than two (2) members (the "Committee"), all of the members
of which Committee shall be Disinterested Persons. If administration is
delegated to a Committee, the Committee shall have, in connection with the
administration of the Plan, the powers therefore possessed by the Board (and
references in this Plan to the Board shall thereafter be the Committee),
subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board. The Board may
abolish the Committee at any time and revisit in the Board the administration of
the Plan. Additionally, prior to the date and revisit in the Board the equity
security of the Company under Section 12 of the Exchange Act, and
notwithstanding anything to the contrary contained herein, the Board may
delegated administration of the Plan to any person or persons and term
"Committee" shall apply to any person or persons to whom such authority has been
delegated. Notwithstanding anything in this Section 3 to the contrary, at any
time the Board or the Committee may delegated to a Committee of one or more
members of the Board the authority to grant Stock Awards to eligible persons who
are not then subject to Section 16 of the Exchange Act.
(d) Any requirement that an administrator of the Plan be a Disinterested
Person shall not apply if the Board or the Committee expressly declares that
such requirement shall not apply. Any Disinterested Person shall otherwise
comply with the requirements of Rule 16b-3.
4. SHARES SUBJECT TO THE PLAN.
(a) Subject to the provisions of Section 13 relating to adjustments upon
changes in stock, the stock that may be issued pursuant to Stock Awards shall
not exceed in the aggregate five hundred thousand (500,000) shares (after taking
into account the 100-for-1 stock split effected in June 1996) of the Company's
common stock. If any Stock Award shall for any reason expire or otherwise
terminate, in whole or in part, without having been exercised in full, the stock
not acquired under Stock Awards shall revert to and again become available for
issuance under the Plan. Shares subject to Stock Appreciation Rights exercised
in accordance with Section 8 of the Plan shall not be available for subsequent
issuance under the Plan.
(b) The stock subject to the Plan may be unissued shares or reacquired
shares, bought on the market or otherwise.
5. ELIGIBILITY.
(a) Incentive Stock Options and Stock Appreciation Rights appurtenant
thereto may be granted only to Employees. Stock Awards other than Incentive
Stock Options and Stock Appreciation Rights appurtenant thereto may be granted
only to Employees, Directors or Consultants.
(b) A Director shall in no event be eligible for the benefits of the Plan
unless at the time discretion is exercised in the selection of the Director as a
person to whom Stock Awards may be granted, or in the determination of the
number of shares which may be covered by Stock Awards granted to the Director:
(i) the Board has delegated its discretionary authority over the Plan to a
Committee which consists solely of Disinterested Persons; or (ii) the Plan
otherwise complies with the requirements of Rule 16b-3. The Board shall
otherwise comply with the requirements of Rule 16b-3. This subsection 5(b)
shall not apply if the Board or Committee expressly declares that it shall not
apply.
4
<PAGE>
(c) No person shall be eligible for the grant of an Option or an award to
purchase restricted stock if, at the time of grant, such person owns (or is
deemed to own pursuant to Section 424(d) of the Code) stock possessing more than
ten percent (10%) of the total combined voting power of all classes of stock of
the Company, or any of its affiliates unless the exercise price of such Option
is at least one hundred ten percent (110%) of the Fair Market Value of such
stock at the date of grant, or in the case of a restricted stock purchase award,
the purchase price is at least one hundred percent (100%) of the Fair Market
Value of such stock at the date of grant.
(d) Subject to the provisions of Section 13 relating to adjustments upon
changes in stock, no person shall be eligible to be granted Options and Stock
Appreciation Rights covering more than five hundred thousand (500,000) shares
(after taking into account the 100-for-1 stock split effected in June 1996) of
the Company's common stock in any twelve (12) month period.
6. OPTION PROVISIONS.
Each Option shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. The provisions of separate
Options need not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or otherwise) the
substance of each of the following provisions:
(a) TERM. No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted.
(b) PRICE. The exercise price of each Incentive Stock Option shall be not
less than one hundred percent (100%) of the Fair Market Value of the stock
subject to the Option on the date the Option is granted; the exercise price of
each Nonstatutory Stock Option shall be not less than eighty-five percent (85%)
of the Fair Market Value of the stock subject to the Option on the date the
Option is granted.
(c) CONSIDERATION. The purchase price of stock acquired pursuant to an
Option shall be paid, to the extent permitted by applicable statutes and
regulations, either (i) in cash at the time the Option is exercised, or (ii) at
the discretion of the Board or the Committee, at the time of the grant of the
Option, (A) by delivery to the Company of other common stock of the Company, (B)
according to a deferred payment or other arrangement (which may include, without
limiting the generality of the foregoing, the use of the common stock of the
Company) with the person to whom the Option is granted or to whom the Option is
transferred pursuant to subsection 6(d), or (C) in any other form of legal
consideration that may be acceptable to the Board.
In the case of any deferred payment arrangement, interest shall be payable
at least annually and shall be charged at the minimum rate of interest necessary
to avoid the treatment as interest, under any applicable provisions of the Code,
of any amounts other than amounts stated to be interest under deferred payment
arrangement.
(d) TRANSFERABILITY. An Incentive Stock Option shall not be transferable
except by will or by the laws of descent and distribution, and shall be
exercisable during the lifetime of the person to whom the Incentive Stock Option
is granted only by such person. A Nonstatutory Stock Plan shall
5
<PAGE>
not be transferable except by will or by the laws of descent and distribution
or pursuant to a qualified domestic relations order satisfying the
requirements of the Rule 16b-3 and any administrative interpretations or
pronouncements thereunder (a "QDRO"), and shall be exercisable during the
lifetime of the person to whom the Option is granted only by such person or
any transferee pursuant to a QDRO. Notwithstanding the foregoing, the person
to whom the Option is granted may, by delivering written notice to the
Company, in the form satisfactory to the Company, designate a third party who,
in the event of the death of the Optionee, shall thereafter be entitled to
exercise the Option.
(e) VESTING. The total number of shares of stock subject to an Option may,
but need not, be allotted in periodic installments (which may, but need not, be
equal). The Option Agreement may provide that from time to time during each of
such installment periods, the Option may become exercisable ("vest") with
respect to some or all of the shares allotted to that period, and may be
exercised with respect to some or all of the shares allotted to such period
and/or any prior period as to which the Option became vested but was not fully
exercised. The Option may be subject to such other terms and conditions on the
time or times when it may be exercised (which may be based on performance or
other criteria) as the Board may deem appropriate. The vesting provisions of
individual Options may vary but in each case will provide for vesting of at
least twenty percent (20%) per year of the total number of shares subject to the
Option. The provisions of this subsection 6(e) are subject to any Option
provisions governing the minimum number of shares as to which Option may be
exercised.
(f) TERMINATION OF EMPLOYMENT OR RELATIONSHIP AS A DIRECTOR OR CONSULTANT.
In the event an Optionee's Continuous Status as an Employee, Director or
Consultant terminates (other than upon the Optionee's death or disability),
the Optionee may exercise his or her Option (to the extent that the Optionee
was entitled to exercise it at the date of termination) but only within such
period of time ending on the earlier of (i) the date three (3) months after
the termination of the Optionee's Continuos Status as an Employee, Director or
Consultant (or such longer or shorter period, which in event shall be less
than thirty (30) days, specified in the Option Agreement), or (ii) the
expiration of the term of the Option as set forth in the Option Agreement. If,
after termination, the Optionee does not exercise his or her Option within the
time specified in the Option Agreement, the Option shall terminate, and the
shares covered by such Option shall revert to and again become available for
issuance under the Plan.
An Optionee's Option Agreement may also provide that if the exercise of the
Option following the termination of the Optionee's Continuous Status as
Employee, Director, or Consultant (other than upon the Optionee's death or
disability) would result in liability under section 16(b) of the Exchange Act,
then the Option shall terminate on the earlier of (i) the expiration of the term
of the Option set forth in the Option Agreement, or (ii) the tenth (10th) day
after the last date on which such exercise would result in such liability under
section 16(b) of the Exchange Act. Finally, an Optionee's Option Agreement may
also provide that if the exercise of the Option following the termination of the
Optionee's Continuous Status as an Employee, Director, or Consultant (other than
upon the Optionee's death or disability) would be prohibited at any time solely
because the issuance of shares would violate the registration requirements under
the act, then the Option shall terminate on the earlier of (i) the expiration of
the term of the Option set forth in the first paragraph of this subsection 6(f),
or (ii) the expiration of a period of three (3) months after the termination of
the Optionee's Continuous Status as an Employee, Director or Consultant during
which the exercise of the Option would not be in violation of such registration
requirements.
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(g) DISABILITY OF OPTIONEE. In the event an Optionee's Continuous Status
as Employee, Director or Consultant terminates as a result of the Optionee's
disability, the Optionee may exercise his or her Option (to the extent that the
Optionee was entitled to exercise it at the date of termination), but only
within such period of time ending on the earlier of (i) the date twelve (12)
months following such termination (or such longer or shorter period, which in no
event shall be less than six (6) months, specified in the Option Agreement), or
(ii) the expiration of the term of the Option as set forth in the Option
Agreement. If, at the date of termination, the Optionee is not entitled to
exercise his or her entire Option, the shares covered by the unexercisable
portion of the Option shall revert to and again become available for issuance
under the Plan. If, after termination, the Optionee does not exercise his or
her Option within the time specified herein, the Option shall terminate, and the
shares covered by such Option shall revert to and again become available for
issuance under the Plan.
(h) DEATH OF OPTIONEE. In the event of the death of the Optionee during,
or within a period specified in the Option after the termination of, the
Optionee's Continuous Status as an Employee, Director or Consultant, the Option
may be exercised (to the extent the Optionee was entitled to exercise the Option
at the date of death) by the Optionee's estate, by a person who acquired the
right to exercise the Option by bequest or inheritance or by a person designated
to exercise the Option upon the Optionee's death pursuant to subsection 6(d),
but only within the period ending on the earlier of (i) the date eighteen (18)
months following the date of death (or such longer or shorter period, which in
no event shall be less than six (6) months, specified in the Option Agreement),
or (ii) the expiration of the term of such Option as set forth in the Option
Agreement. If, at the time of death, the Optionee was not entitled to exercise
his or her entire Option, the shares covered by the unexercisable portion of the
Option shall revert to and again become available for issuance under the Plan.
If, after death, the Option is not exercised within the time specified herein,
the Option shall terminate, and the shares covered by such Option shall revert
to and again become available for issuance under the Plan.
(i) EARLY EXERCISE. The Option may, but need not, included a provision
whereby the Optionee may elect at any time while an Employee, Director or
Consultant to exercise the Option as to any part or all of the shares subject to
the Option prior to the full vesting of the Option. Any unvested shares so
purchased shall be subject to a repurchase right in favor of the Company, with
the repurchase price to be equal to the original purchase price of the stock, or
to any other restriction the Board determines to be appropriate; provided,
however, that (i) the right to repurchase at the original purchase price shall
lapse at a minimum rate of twenty percent (20%) per year over five (5) years
from the date the Option was granted, and (ii) such right shall be exercisable
only within (A) the ninety (90) day period following the termination of
employment or the relationship as a Director or Consultant, or (B) such longer
period as may be agreed to by the Company and the Optionee (for example, for
purposes of satisfying the requirement of Section 1202(c)(3) of the Code
(regarding "qualified small business stock")), and (iii) such right shall be
exercisable only for cash or cancellation of purchase money indebtedness for the
shares. Should the right of repurchase be assigned by the Company, the assignee
shall pay the Company cash equal to the difference between the original purchase
price and the stock's Fair Market Value if the original purchase price is less
than the stock's Fair Market Value.
(j) RIGHT OF REPURCHASE. The Option may, but need not, include a provision
whereby the Company may elect, prior to the date of the first registration of an
equity security of the Company under Section 12 of the Exchange Act, to
repurchase all or any part of the vested shares exercised
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pursuant to the Option; provided, however, that (i) such repurchase right
shall be exercisable only within the ninety (90) day period following the
termination of employment or the relationship as a Director or Consultant, and
(ii) such right shall be exercisable only for cash or cancellation of purchase
money indebtedness for the shares at a repurchase price equal to the greater
of (A) the stock's Fair Market Value at the time of such termination, or (B)
the original purchase price paid for such shares by the Optionee.
(k) RIGHT OF FIRST REFUSAL. The Option may, but need not, include a
provision whereby the Company may elect, prior to the date of the first
registration of an equity security of the Company under Section 12 of the
Exchange Act, to exercise a right of first refusal following receipt of notice
from the Optionee of the intent to transfer all or any part of the shares
exercised pursuant to the Option.
(l) RE-LOAD OPTIONS. Without in any way limiting the authority of the
Board or Committee to make or not to make grants hereunder, the Board or
Committee shall have the authority (but not an obligation) to included as part
of any Option Agreement a provision entitling the Optionee to a further Option
(a "Re-Load Option") in the event the Optionee exercises the Option evidenced by
the Option Agreement, in whole or in part, by surrounding other shares
surrendered as part or all of the exercise price of such Option; (ii) shall
have an expiration date which is the same as the expiration date of the Option
the exercise of which gave rise to such Re-Load Option; and (iii) shall have
an exercise price which is equal to one hundred percent (100%) of the Fair
Market Value of the Common Stock subject to the Re-Load Option on the date of
exercise of the original Option. Notwithstanding the foregoing, a Re-load
Option which is granted to a 10% stockholder (as described in subsection 5
(c)), shall have an exercise price which is equal to one hundred ten percent
(110%) of the Fair Market Value of the stock subject to the Re-Load Option on
the date of exercise of the original Option and shall have a term which is no
longer than five (5) years.
Any such Re-Load Option may be an Incentive Stock Option or a Nonstatutory
Stock Option, as the Board or Committee may designate at the time of the grant
of the original Option; provided, however, that the designation of any Re-Load
Option as an Incentive Stock Option shall be subject to the one hundred thousand
dollar ($100,000) annual limitation on exercisability of Incentive Stock Options
described in subsection 12(e) of the Plan and in Section 422(d) of the Code.
There shall be no Re-Load Options on a Re-Load Option. Any such Re-Load Option
shall be subject to the availability of sufficient shares under subsection 4(a)
and shall be subject to such other terms and conditions as the Board or
Committee may determine which are not inconsistent with the express provisions
of the Plan regarding terms of Options.
7. TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK.
Each stock bonus or restricted stock purchase agreement shall be on such
form and shall contain such terms and conditions as the Board or the Committee
shall deem appropriate. The terms and conditions of stock bonus or restricted
stock purchase agreements may change from time to time, and the terms and
conditions of separate agreements may need not be identical, but each stock
bonus or restricted stock purchase agreement shall include (through
incorporation of provisions hereof by reference in the agreement or otherwise)
the substance of each of the following provisions as appropriate.
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(a) PURCHASE PRICE. The purchase price under each restricted stock
purchase agreement shall be such amount as the Board or Committee shall
determine and designate in such agreement, but in no event shall the purchase
price be less than eighty-five percent (85%) of the stock's Fair Market Value on
the date such award is made. Notwithstanding the foregoing, the Board or the
Committee may determine that eligible participants in the Plan may be awarded
stock pursuant to a stock bonus agreement in consideration for past services
actually rendered to the Company or for its benefit.
(b) TRANSFERABILITY. No rights under a stock bonus or restricted stock
purchase agreement shall be transferable except by will or the laws of decent
and distribution or pursuant to a qualified domestic relations order satisfying
the requirements of Rule 16b-3 and any administrative interpretations or
pronouncements thereunder, so long as stock awarded under such agreement remains
subject to the terms of the agreement.
(c) CONSIDERATION. The purchase price of the stock acquired pursuant to a
stock purchase shall be paid either: (i) in cash at the time of purchase; (ii)
at the discretion of the Board or the Committee, according to a deferred payment
or other arrangement with the person to whom the stock is sold; or (iii) in any
other form of legal consideration that may be acceptable to the Board or the
Committee in its discretion. Notwithstanding the foregoing, the Board or the
Committee to which administration of the Plan has been delegated may award stock
pursuant to a stock bonus agreement in consideration for past services actually
rendered to the Company or for its benefit.
(d) VESTING. Shares of stock sold or awarded under the Plan may, but need
not, be subject to a repurchase Option in favor of the Company in accordance
with a vesting schedule to be determined by the Board or the Company in
accordance with a vesting schedule to be determined by the Board or the
Committee; provided, however, that (i) the right to repurchase at the original
purchase price shall lapse at a minimum rate of twenty percent (20%) per year
over five (5) years from the date the Stock Award was granted, and (ii) such
right shall be exercisable only (A) within the ninety (90) day period following
the termination of employment or relationship as a Director or Consultant, or
(B) such longer period as may be agreed to by the Company and the holder of the
Stock Award (for example, for purposes of satisfying the requirements of Section
1202(c)(3) of the Code (regarding "qualified small business stock")), and (iii)
such right shall be exercisable only for cash or cancellation of purchase money
indebtedness for the shares. Should the right of repurchase be assigned by the
Company, the assignee shall pay the Company cash equal to the difference between
the original purchase price and the stock's Fair Market Value if the original
purchase price is less than the stock's Fair Market Value.
(e) TERMINATION OF EMPLOYMENT OR RELATIONSHIP AS A DIRECTOR OR CONSULTANT.
In the event a participant's Continuous Status as a Employee, Director or
Consultant terminates, the Company may repurchase or otherwise acquire, subject
to the limitations described in subsection 7(d), any or all of the shares of
stock held by that person which have not vested as of the date of termination
under the terms of the stock bonus or restricted stock purchase agreement
between the Company and such person.
8. STOCK APPRECIATION RIGHTS.
(a) The Board or Committee shall have full power and authority, exercisable
in its sole discretion, to grant Stock Appreciation Rights under the Plan to
Employees or Directors of or
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Consultants to, the Company or its Affiliates. To exercise any outstanding
Stock Appreciation Right, the holder must provide written notice of exercise
to the Company in compliance with the provisions of a Stock Award Agreement
evidencing such right. If a Stock Appreciation Right is granted to an
individual who is at the time subject to Section 16(b) of the Exchange Act (a
"Section 16(b) Insider"), the Stock Award Agreement of grant shall incorporate
all the terms and conditions at the time necessary to assure that the
subsequent exercise of such right shall qualify for the safe-harbor exemption
from short-swing profit liability provided by Rule 16b-3 promulgated under the
Exchange Act (or any successor Rule or regulation). Except as provided in
subsection 5(d), no limitation shall exist on the aggregate amount of cash
payments the Company may make under the Plan in connection with the exercise
of a Stock Appreciation Rights.
(b) Three types of Stock Appreciation Rights shall be authorized for
issuance under the Plan:
(1) TANDEM STOCK APPRECIATION RIGHTS. Tandem Stock Appreciation
Rights will be granted appurtenant to an Option, and except as specifically
set forth in this Section 8, be subject to the same terms and conditions
applicable to the particular Option grant to which it pertains. Tandem Stock
Appreciation Rights will require the holder to elect between the exercise of
the underlying Option for shares of stock and the surrender, in whole or in
part, of such Option for an appreciation distribution. The appreciation
distribution payable on the exercised Tandem Right shall be in cash (or, if so
provided, in an equivalent number of shares of stock based on Fair Market
Value on the date of the Option surrender) in the amount up to the excess of
(A) the Fair Market Value (on the date of the Option surrender) of the number
of shares of stock covered by that portion of the surrendered Option in which
the Optionee is vested over (B) the aggregate exercise price payable for such
vested shares.
(2) CONCURRENT STOCK APPRECIATION RIGHTS. Concurrent Rights will be
granted appurtenant to an Option and may apply to all or any portion of the
shares of stock subject to the underlying Option and shall, except as
specifically set forth in Section 8, be subject to the same terms and conditions
applicable to the particular Option grant to which it pertains. A Concurrent
Right shall be exercised automatically at the same time the underlying Option is
exercised with respect to particular shares of stock to which the Concurrent
Right pertains. The appreciation distribution payable on an exercised
Concurrent Right shall be in cash (or, if so provided, in an equivalent number
of shares of stock based on Fair Market Value on the date of the exercise of the
Concurrent Right) in an amount equal to such portion as shall be determined by
the Board or Committee at the time of the grant of the excess of (A) the
aggregate Fair Market Value (on the date of the exercise of the Concurrent
Right) of the Vested shares of the vested shares of stock purchased under the
underlying Option which have Concurrent Rights appurtenant to them over (B) the
aggregate exercise price paid for such shares.
(c) INDEPENDENT STOCK APPRECIATION RIGHTS. Independent Rights will be
granted independently of any Option and shall, except as specifically set forth
in this Section 8, be to the same terms and conditions applicable to
Nonstatutory Stock Options set forth in Section 6. They shall be denominated in
share equivalents. The appreciation distribution payable on the exercised
Independent Right shall be not greater than an amount equal to the excess of (A)
the aggregate Fair Market Value (on the date of the exercise of the Independent
Right) of a number of shares of Company stock equal to the number of shares
equivalents in which the holder is exercising the Independent Right on such
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date, over (B) the aggregate Fair Market Value (on the date of the grant of the
Independent Right) of such numbers of shares of Company stock. The appreciation
distribution on the exercised Independent Right shall be cash or, if so
provided, in a equivalent number of shares of stock based on Fair Market Value
on the date of the exercise of the Independent Right.
9. CANCELLATION AND RE-GRANT OF OPTIONS.
(a) The Board or the Committee shall have the authority to effect, at any
time and from time to time, (i) the repricing of any outstanding Options and/or
any Stock Appreciation Rights under the Plan and/or any Stock Appreciation
Rights under the Plan and/or (ii) with the consent of the affected holders of
Options and/or Stock Appreciation Rights, the cancellation of any outstanding
Options and/or any Stock Appreciation Rights under the Plan and the grant in
substitution thereof of new Options and/or Stock Appreciation Rights under the
Plan covering the same or different numbers of shares of stock, but having an
exercise price per share not less than eighty-five percent (85%) of the Fair
Market Value (one hundred percent (100%) of the Fair Market Value in the case
of an Incentive Stock Option) or, in the case of a 10% stockholder (as
described in subsection 5(c)), not less than one hundred ten percent (110%) of
the Fair Market Value) per share of stock on the new grant date.
Notwithstanding the foregoing, the Board or the Committee may grant an Option
and/or Stock and/or Stock Appreciation Right is granted as part of a
transaction to which Section 424(a) of the Code applies.
(b) Shares subject to an Option or Stock Appreciation Right canceled under
this Section 9 shall continue to be counted against the maximum award of Options
and Stock Appreciation Rights permitted to be granted pursuant to subsection
5(d) of the Plan. The repricing of an Option and/or Stock Appreciation Right
under this Section 9, resulting in a reduction of the exercise price, shall be
deemed to be a cancellation of the original Option and/or Stock Appreciation
Right and the grant of a substitute Option and/or Stock Appreciation Right; in
the event of such repricing, both the original and the substituted Options and
Stock Appreciation Rights shall be counted against the awards of Options and
Stock Appreciation Rights permitted to be granted pursuant to subsection 5(d) of
the Plan. The provisions of this subsection 9(b) shall be applicable only to
the extent required by Section 162(m) of the Code.
10. COVENANTS OF THE COMPANY.
(a) During the terms of the Stock Awards, the Company shall keep available
at all times the number of shares of stock required to satisfy such Stock
awards.
(b) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell shares of stock upon exercise of Company to register under the
Securities Act of 1933, as amended (the "Securities Act") either the Plan, any
stock issued or issuable pursuant to any such stock award. If, after reasonable
efforts, the Company is unable to obtain from any such regulatory commission or
agency the authority which counsel for the Company deems necessary for the
lawful issuance and sale of stock under the Plan, the Company shall be relieved
from any liability for failure to issue and sell stock upon exercise of such
stock awards unless and until such authority is obtained.
11. USE OF PROCEEDS FROM STOCK.
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Proceeds from the sale of stock pursuant to Stock Awards shall constitute
general funds of the Company.
12. MISCELLANEOUS.
(a) Neither an Employee, Director or Consultant nor any person to whom a
Stock Award is transferred under subsection 6(d), 7(b), or 8(b) shall be deemed
to be the holder of, or have any of the rights of a holder with respect to, any
shares subject to such Stock Award unless and until such person has satisfied
all requirements for exercise of the stock award pursuant to its terms.
(b) Throughout the term of any Stock Award, the Company shall deliver to
the holder of such Stock Award, not later than one hundred twenty (120) days
after the close of each of the Company's fiscal years during the term of such
Stock Award, a balance sheet and an income statement. This Section shall not
apply when issuance is limited to key employees whose duties in connection
with the Company assure them access to equivalent information.
(c) Nothing in the Plan or any instrument executed or Stock Award granted
pursuant thereof shall confer upon any Employee, Director, Consultant or other
holder of Stock Awards any right to continue in the employ of the Company or any
Affiliate (or to continue acting as Director or Consultant) or shall affect the
right of the Company or any Affiliate to terminate the employment of any
Employee with or without cause, the right of the Company's Board of Directors
and/or the Company's shareholders to remove any Director pursuant to the terms
of the Company's Bylaws and the provisions of the California Corporations Code,
or the right to terminate the relationship of any Consultant pursuant to the
terms of such Consultant's agreement with the Company or Affiliates.
(d) To the extent that the aggregate Fair Market Value (determined at the
time of grant) of stock with respect to which Incentive Stock Options are
exercisable for the first time by any Optionee during any calendar year under
all Plans of the Company and its Affiliates exceed such limit (according to the
order in which they were granted) shall be treated as Nonstatutory Stock Option.
(e) The Company may require any person to whom a Stock Award is granted, or
any person to whom a Stock Award is transferred pursuant to subsection 6(d),
7(b) or 8(b), as a condition of exercising or acquiring stock under any Stock
Award: (1) to give written assurances satisfactory to the Company as to such
person's knowledge and experience in financial and business matters and/or to
employ a purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters, and that he or
she is capable of evaluating, alone or together with the purchasers, and that he
or she is capable of evaluating, alone or together with the purchaser
representative, the merits and risk of exercising the Stock Award; and (2) to
give written assurances satisfactory to the Company stating that such person is
acquiring the stock subject to the Stock Award for such person's own account and
not with any present intention of selling or otherwise distributing the stock.
The foregoing requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (i) the issuance of the shares upon the
exercise or acquisition of stock under the Stock Award has been register under a
the currently effective registration statement under the Securities Act, or (ii)
as to any particular requirement a determination is made by counsel for the
Company that such requirements need not be met in the circumstances under the
then applicable securities laws. The Company may, upon advice of counsel to the
Company, place legends
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on stock certificates issued under the Plan as such counsel deems necessary or
appropriate in order to comply with applicable securities laws, including but
not limited to, legends restricting the transfer of the stock.
(f) To the extent provided by the terms of a Stock Award Agreement, the
person to whom a Stock Award is granted may satisfy any federal, state or local
tax withholding obligation relating to exercise or acquisition of stock under a
Stock Award by any of the following means or by a combination of such means: (1)
tendering a cash payment; (2) authorizing the Company to withhold shares from
the shares of the common stock otherwise issuable to the participant as result
of the exercise or acquisition of stock under the Stock Award; or (3) delivering
to the Company owned and unencumbered shares of the common stock of the Company.
13. ADJUSTMENTS UPON CHANGES IN STOCK.
(a) If any change is made in the stock subject to the Plan, or subject to
any Stock Award, without the receipt of consideration by the Company (through
merger, consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or other transaction not involving the receipt of consideration by the
Company), the Plan will be appropriately adjusted in the class(es) and maximum
number of shares subject to the Plan pursuant to subsection 4(a) and the maximum
number of shares subject to award to any person during any twelve (12) month
period pursuant to subsection 5(d), and the outstanding Stock Awards will be
appropriately adjusted in the class(es) and number of shares and price per share
of stock subject to such outstanding Stock Awards. Such adjustments shall be
made by the Board or the Committee, the determination of which shall be final,
binding and conclusive. (The conversion of any convertible securities of the
Company shall not be treated as a "transaction not involving the receipt of
consideration by the Company").
(b) In the event of: (1) a merger or consolidation in which the Company is
not the surviving corporation or (2) a reverse merger in which the Company is
the surviving corporation but the shares of the Company's common stock
outstanding immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash or otherwise
then to the extent permitted by applicable law: (i) any surviving corporation or
an affiliate of such surviving corporation shall assume any Stock Awards
outstanding under the Plan, or (ii) such Stock Awards shall continue in full
force and effect. In the event any surviving corporation and its affiliates
refuse to assume or continue such Stock Awards, or to substitute similar Stock
Awards for those outstanding under the Plan, then such Stock Awards shall be
terminated if not exercised prior to such event. In the event of a dissolution
or liquidation of the Company, any Stock Awards outstanding under the Plan shall
terminate if not exercised prior to such event.
14. AMENDMENT OF THE PLAN AND STOCK AWARDS.
(a) The Board at the time, and from time to time, may amend the Plan.
However, except as provided in Section 13 relating to adjustments upon changes
in stock, no amendment shall be effective unless approved by the stockholders of
the Company within twelve (12) months before or after the adoption of the
amendment, where the amendment will:
(i) Increase the number of shares reserved for Stock Awards under the
Plan;
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(ii) Modify the requirements as to eligibility for participation in
the Plan (to the extent such modification requirements of Section 422 of the
Code); or
(iii) Modify the Plan in any other way if such modification requires
stockholder approval in order for the Plan to satisfy the requirements of
Section 422 of tile Code or to comply with requirement of Rule 16b-3.
(b) The Board may in its sole discretion submit any other amendment to the
Plan intended to satisfy the requirements of Section 162(m) of the Code and the
regulations promulgated thereunder regarding the exclusion of performance-based
compensation from the limit on corporate deductibility of compensation paid to
certain executive officers.
(c) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide eligible Employees,
Directors or Consultants with the maximum benefits provided or to be provided
under the provisions of the Code and the regulations promulgated thereunder
relating to Incentive Stock Options and or to bring the Plan and/or Incentive
Stock Options granted under it into compliance therewith.
(d) Rights and obligations under any Stock Award granted before amendment
of the Plan shall not be impaired by any amendment of the Plan unless (i) the
Company requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.
(e) The Board at any time, and from time to time, may amend the terms of
any one or more stock award; provided, however, that the rights and obligations
under any requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.
15. TERMINATION OR SUSPENSION OF THE PLAN.
(a) The Board may suspend or terminate the Plan at any time. Unless sooner
terminated, the Plan shall terminate on May 31, 2006 which shall be within ten
(10) years from the date the Plan is adopted by the Board or approved by the
stockholders of the Company, whichever is earlier. No Stock Awards may be
granted under the Plan while the Plan is suspended or after it is terminated.
(b) Rights and obligation under any Stock Award granted while the Plan is
in effect shall not be impaired by suspension or termination of the Plan, except
with the consent of the person to whom the stock award was granted.
16. EFFECTIVE DATE OF PLAN.
The Plan shall become effective as determined by the Board, but no Stock
Awards granted under the Plan shall be exercised unless and until the Plan has
been approved by the stockholders of the Company, which approval shall be within
twelve (12) months before or after the date the Plan is adopted by the Board,
and if required, an appropriate permit has been issued by the Commissioner of
Corporations of the State of California.
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EXHIBIT 99.2
NONSTATUTORY STOCK OPTION
[NAME], Optionee:
FORTE ADVANCED MANAGEMENT SOFTWARE, INC. (the "Company"), pursuant to its
1996 Stock Plan (the "Plan"), has granted to you, the optionee named above, an
option to purchase shares of the common stock of the Company ("Common Stock").
This option is not intended to qualify and will not be treated as an "incentive
stock option" within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code").
The grant hereunder is in connection with and in furtherance of the
Company's compensatory benefit plan for participation of the Company's employees
(including officers), directors or consultants, and is intended to comply with
provisions of Rule 701 promulgated by the Securities and Exchange Commission
under the Securities Act of 1933, as amended (the "Act"). Defined terms not
explicitly defined in this agreement but defined in the Plan shall have the same
definitions as in the Plan.
The details of your option are as follows:
1. TOTAL NUMBER OF SHARES SUBJECT TO THE OPTION. The total number
of shares of Common Stock subject to this option is _______ (x,xxx).
2. VESTING. Subject to the limitations contained herein, ______ of
the total number of shares subject to this option shall be vested (exercisable)
as of the date hereof and the remaining _________ shares subject to this option
will vest (become exercisable) in three (3) equal annual installments on each
one-year anniversary of the date hereof, so that the entire number of shares
subject to this option will be vested on the date that is three (3) years from
the date hereof; provided that in no event shall any such installment vest
following the interruption or termination of your Continuous Status as an
Employee, Director or Consultant.
3. EXERCISE PRICE AND METHOD OF PAYMENT.
(a) EXERCISE PRICE. The exercise price of this option is _____
($x.xx) per share, being not less than the Fair Market Value of the Common Stock
on the date of grant of this option.
(b) METHOD OF PAYMENT. Payment of the exercise price per share is due
in full upon exercise of all or any part of each installment which has accrued
to you.
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You may elect, to the extent permitted by applicable statutes and regulations,
to make payment of the exercise price under one of the following alternatives:
(i) Payment of the exercise price per share in cash (including
check) at the time of exercise;
(ii) Payment pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board which, prior to the issuance of Common
Stock, results in either the receipt of cash (or check) by the Company or the
receipt of irrevocable instructions to pay the aggregate price to the Company
from the sales proceeds;
(iii) Provided that at the time of exercise the Company's Common
Stock is publicly traded and quoted regularly in the Wall Street Journal,
payment by delivery of already-owned shares of Common Stock, held for the period
required to avoid a charge to the Company's reported earnings, and owned free
and clear of any liens, claims, encumbrances or security interests, which Common
Stock shall be valued at its Fair Market Value on the date of exercise; or
(iv) Payment by a combination of the methods of payment permitted
by subparagraph 3(b)(i) through 3(b)(iii) above.
4. WHOLE SHARES. This option may not be exercised for any number of
shares which would require the issuance of anything other than whole shares.
5. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the
contrary contained herein, this option may not be exercised unless the shares
issuable upon exercise of this option are then registered under the Act or, if
such shares are not then so registered, the Company has determined that such
exercise and issuance would be exempted from the registration requirements of
the Act.
6. TERM. The term of this option commences on ______, the date of
grant, and expires on _______ (the "Expiration Date"), which date shall be no
more than ten (10) years from the date this option is granted), unless this
option expires sooner as set forth below or in the Plan. In no event may this
option be exercised on or after the Expiration Date. This option shall
terminate prior to the Expiration Date as follows: three (3) months after the
termination of your Continuous Status as an Employee, Director or Consultant
with the Company or an Affiliate of the Company for any reason or for no reason
unless:
(a) such termination of Continuous Status as an Employee, Director or
Consultant is due to your permanent and total disability, (within the meaning of
Section 422(c)(6) of the Code), in which event the option shall expire on the
earlier of the Expiration Date set forth above or twelve (12) months following
such termination of Continuous Status as an Employee, Director or Consultant; or
2.
<PAGE>
(b) such termination of Continuous Status as an Employee, Director or
Consultant is due to your death or your death occurs within three (3) months
following your termination for any other reason, in which event the option shall
expire on the earlier of the Expiration Date set forth above or twelve (12)
months after your death; or
(c) during any part of such three (3) month period the option is not
exercisable solely because of the condition set forth in paragraph 5 above, in
which event the option shall not expire until the earlier of the Expiration Date
set forth above or until it shall have been exercisable for an aggregate period
of three (3) months after the termination of Continuous Status as an Employee,
Director or Consultant; or
(d) exercise of the option within three (3) months after termination
of your Continuous Status as an Employee, Director or Consultant with the
Company or with an Affiliate of the Company would result in liability under
section 16(b) of the Securities Exchange Act of 1934 (the "Exchange Act"), in
which case the option will expire on the earlier of (i) the Expiration Date set
forth above, (ii) the tenth (10th) day after the last date upon which exercise
would result in such liability or (iii) six (6) months and ten (10) days after
the termination of your Continuous Status as an Employee, Director or Consultant
with the Company or Affiliate of the Company.
However, this option may be exercised following termination of
Continuous Status as an Employee, Director or Consultant only as to that number
of shares as to which it was exercisable on date of termination of Continuous
Status as an Employee, Director or Consultant under the provisions of paragraph
2 of this option.
7. REPRESENTATIONS. By executing this option agreement, you hereby
warrant and represent that you are acquiring this option for your own account
and that you have no intention of distributing, transferring or selling all or
any part of this option except in accordance with the terms of this option
agreement.
8. EXERCISE.
(a) This option may be exercised to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other person
as the Company may designate, during regular business hours, together with such
additional documents as the Company may then require pursuant to subsection
12(e) of the Plan.
(b) By exercising this option you agree that:
(i) as a precondition to the completion of any exercise of this
option, the Company may require you to enter an arrangement providing for the
cash payment by you to the Company of any tax withholding obligation of the
Company arising by reason of: (1) the exercise of this option; (2) the lapse of
any substantial risk of forfeiture to which the shares are
3.
<PAGE>
subject at the time of exercise; or (3) the disposition of shares acquired upon
such exercise. You also agree that any exercise of this option has not been
completed and that the Company is under no obligation to issue any Common Stock
to you until such an arrangement is established or the Company's tax withholding
obligations are satisfied, as determined by the Company; and
(ii) the Company (or a representative of the underwriters) may, in
connection with the first underwritten registration of the offering of any
securities of the Company under the Act, require that you not sell or otherwise
transfer such period of any shares of Common Stock or other Securities of the
Company during such period (not to exceed one hundred eighty (180) days)
following the effective date (the "Effective Date") of the registration
statement of the Company filed under the Act as may be requested by the Company
or the representative of the underwriters. You further agree that the Company
may impose stop-transfer instructions with respect to securities subject to the
foregoing restrictions until the end of such period.
9. TRANSFERABILITY. This option is not transferable, except by will
or by the laws of descent and distribution, and is exercisable during your life
only by you. Notwithstanding the foregoing, by delivering written notice to the
Company, in a form satisfactory to the Company, you may designate a third party
who, in the event of your death, shall thereafter be entitled to exercise this
option.
10. OPTION NOT A SERVICE CONTRACT. This option is not an employment
contract and nothing in this option shall be deemed to create in any way
whatsoever any obligation on your part to continue in the employ of the Company,
or of Company to continue your employment with the Company. In addition,
nothing in this option shall obligate the Company or any Affiliate of the
Company, or their respective shareholders, Board of Directors, officers, or
employees to continue any relationship which you might have as a Director or
Consultant for the Company or Affiliate of the Company.
11. NOTICES. Any notices provided for in this option or the Plan
shall be given in writing and shall be deemed effectively given upon receipt or,
in the case of notices delivered by the Company to you, five (5) days after
deposit in the United States mail, postage prepaid, addressed to you at the
address specified below or such other address as you hereafter designate by
written notice to the Company.
12. GOVERNING PLAN DOCUMENT. This option is subject to all
provisions of the Plan, a copy of which is attached hereto and its provisions
are hereby made a part of this option, including without limitation the
provisions of Section 6 of the Plan relating to option provisions, and is
further subject to all interpretations, amendments, rules, and regulations which
from time to time may be promulgated and adopted pursuant to the Plan. In the
event of any conflict between the provisions of the option and those of the
Plan, the provisions of the Plan shall control.
Dated the ____ day of _____, 199__.
4.
<PAGE>
Very truly yours,
FORTE ADVANCED MANAGEMENT SOFTWARE, INC.
BY: -----------------------------------------
Duly Authorized on behalf of the Board of
Directors
ATTACHMENTS:
1996 Stock Plan
Notice of Exercise
5.
<PAGE>
The undersigned:
(a) Acknowledges receipt of the foregoing option and the
attachments referenced therein and understands that all rights and liabilities
with respect to this option are set forth in the option and the Plan; and
(b) Acknowledges that as of the date of grant of this option, it
sets forth the entire understanding between the undersigned optionee and the
Company and its Affiliates regarding the acquisition of stock in the Company and
supersedes all prior oral and written agreements on that subject with the
exception of (i) the options previously granted and delivered to the undersigned
under stock option plans of the Company, and (ii) the following agreements only:
NONE
-------------------
(initial)
OTHER
-------------------
-------------------
-------------------
(c) Acknowledges receipt of the copy of Section 260.141.11 of
Title 10 of The California Code of Regulations.
---------------------------------------------
OPTIONEE
Address: ---------------------------------------------
---------------------------------------------
6.
<PAGE>
EXHIBIT 99.3
NOTICE OF EXERCISE
FORTE ADVANCED MANAGEMENT SOFTWARE, INC.
2141 Palomar Airport Road
Suite 100
Carlsbad, CA 92009
Ladies and Gentlemen:
This constitutes notice under my nonstatutory stock option that I elect to
purchase the number of shares for the price set forth below.
Stock Option dated: -------------------------
Number of shares as to which option
is exercised: -------------------------
Certificates to be issued in name of:
-------------------------
Total exercise price: $
-------------------------
Cash payment delivered herewith: $
-------------------------
By this exercise, I agree (i) to provide such additional documents as you
may require pursuant to the terms of the 1996 Stock Plan and (ii) to provide for
the payment by me to you (in the manner designated by you) of your withholding
obligation, if any, relating to the exercise of this option.
I hereby make the following certifications and representations with respect
to the number of shares of Common Stock of the Company listed above (the
"Shares"), which are being acquired by me for my own account upon exercise of
the Option as set forth above:
I acknowledge that the Shares have not been registered under the Securities
Act of 1933, as amended (the "Act"), and are deemed to constitute "restricted
securities" under Rule 701 and "control securities" under Rule 144 promulgated
under the Act. I warrant and represent to the Company that I have no present
intention of distributing or selling said Shares, except as permitted under the
Act and any applicable state securities laws.
<PAGE>
I further acknowledge that I will not be able to recall the Shares for
at least ninety days after the stock of the Company becomes publicly traded
(i.e., subject to the reporting requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934) under Rule 701 and that more restrictive
conditions apply to affiliates of the Company under Rule 144.
I further acknowledge that all certificates representing any of the
Shares subject to the provisions of the Option shall have endorsed thereon
appropriate legends reflecting the foregoing limitations, as well as any legends
reflecting restrictions pursuant to the Company's Articles of Incorporation,
Bylaws and/or applicable securities laws.
I further agree that, if required by the Company (or a representative
of the underwriters) in connection with the first underwritten registration of
the offering of any securities of the Company under the Act, I will not sell or
otherwise transfer or dispose of any shares of Common Stock or other securities
of the Company during such period (not to exceed one hundred eighty (180) days)
following the effective date of the registration statement of the Company filed
under the Act (the "Effective Date") as may be requested by the Company or
representative of the underwriters. I further agree that the Company may impose
stop-transfer instructions with respect to securities subject to the foregoing
restrictions until the end of such period.
Very truly yours,
---------------------------------------
2
<PAGE>
EXHIBIT 99.4
GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
STOCK OPTION ASSUMPTION AGREEMENT
OPTIONEE: 1
STOCK OPTION ASSUMPTION AGREEMENT issued as of the 30th day of
December, 1997 by Genesys Telecommunications Laboratories, Inc., a California
corporation ("Genesys").
WHEREAS, the undersigned individual ("Optionee") holds one or more
outstanding options to purchase shares of the common stock of Forte Advanced
Management Software, Inc., a California corporation ("Forte"), which were
granted to Optionee under the Forte 1996 Stock Plan (the "Plan"), and are
evidenced by a Stock Option Agreement (the "Option Agreement") between Forte and
Optionee.
WHEREAS, Forte has this day been acquired by Genesys through merger of
a wholly-owned Genesys subsidiary ("Acquisition Corporation") with and into
Forte (the "Merger") pursuant to the Agreement of Merger and Reorganization
dated as of December 30, 1997 by and among Genesys, Forte, Acquisition
Corporation and certain shareholders of Forte (the "Merger Agreement").
WHEREAS, the provisions of the Merger Agreement require Genesys to
assume all obligations of Forte under all options outstanding under the Plan at
the consummation of the Merger and to issue to the holder of each outstanding
option an agreement evidencing the assumption of such option.
WHEREAS, pursuant to the provisions of the Merger Agreement, the
exchange ratio in effect for the Merger is 0.195086 of a share of Genesys common
stock ("Genesys Stock") for each outstanding share of Forte common stock (the
"Exchange Ratio").
WHEREAS, this Agreement is to become effective immediately upon the
consummation of the Merger (the "Effective Time") in order to reflect certain
adjustments to Optionee's outstanding options under the Plan which have become
necessary by reason of the assumption of those options by Genesys in connection
with the Merger.
NOW, THEREFORE, it is hereby agreed as follows:
1. The stock options held by Optionee under the Plan immediately
prior to the Effective Time (the "Forte Options") and the exercise price payable
per share are set forth in Exhibit A hereto. Genesys hereby assumes, as of the
Effective Time, all the duties and obligations of Forte under each of the Forte
Options. In connection with such assumption, the number of shares of Genesys
Stock purchasable under each Forte Option hereby assumed and the exercise price
payable thereunder have been adjusted to reflect the Exchange Ratio at which
shares of Forte common stock ("Forte Stock") were converted into shares of
Genesys Stock in consummation of the Merger. Accordingly, the number of shares
of Genesys Stock subject to
<PAGE>
each Forte Option hereby assumed shall be as specified for that option in
attached Exhibit B, and the adjusted exercise price payable per share of Genesys
Stock under the assumed Forte Option shall be as indicated for that option in
attached Exhibit B.
2. The intent of the foregoing adjustments to each assumed Forte
Option is to assure that the spread between the aggregate fair market value of
the shares of Genesys Stock purchasable under each such option and the aggregate
exercise price as adjusted pursuant to this agreement will, immediately after
the consummation of the Merger, equal the spread which existed, immediately
prior to the Merger, between the then aggregate fair market value of the Forte
Stock subject to the Forte Option and the aggregate exercise price in effect at
such time under the Option Agreement. Such adjustments are also designed to
preserve, immediately after the Merger, on a per share basis, the same ratio of
exercise price per option share to fair market value per share which existed
under the Forte Option immediately prior to the Merger.
3. The following provisions shall govern each Forte Option hereby
assumed by Genesys:
(a) Unless the context otherwise requires, all references to
the "Company" in each Option Agreement and in the Plans (as
incorporated into such Option Agreement) shall mean Genesys, all
references to "common stock" shall mean shares of Genesys Stock, and
all references to the "Board of Directors" or the "Committee" shall
mean the Board of Directors of Genesys or the Compensation Committee
of such Board.
(b) The grant date and the expiration date of each assumed
Forte Option and all other provisions which govern either the
exercisability or the termination of the assumed Forte Option shall
remain the same as set forth in the Option Agreement applicable to
that option and shall accordingly govern and control Optionee's rights
under this Agreement to purchase Genesys Stock.
(c) The minimum exercise requirement under each assumed
Forte Option shall be adjusted in accordance with the Exchange Ratio.
However, such requirement shall not be applicable to the extent the
assumed Forte Option is exercised for the total number of shares of
Genesys Stock at the time purchasable thereunder.
(d) Each assumed Forte Option shall remain exercisable in
accordance with the same installment exercise schedule in effect under
the applicable Option Agreement immediately prior to the Effective
Time, with the number of shares of Genesys Stock subject to each such
installment adjusted to reflect the Exchange Ratio. Accordingly, no
accelerated vesting of the Forte Options shall be deemed to
automatically occur by reason of the Merger, and the grant date for
each assumed Forte Option shall accordingly remain the same as in
effect under the applicable Option Agreement immediately prior to the
Merger.
2
<PAGE>
(e) For purposes of applying any and all provisions of the
Option Agreement relating to Optionee's continuous status as an
employee, director or consultant with the Company, Optionee shall be
deemed to continue in such status for so long as Optionee renders
services as an employee, director or consultant to Genesys or any
present or future Genesys subsidiary, including (without limitation)
Forte. Accordingly, the provisions of the Option Agreement governing
Optionee's status as an employee, director or consultant with Forte
shall hereafter be applied on the basis of Optionee's status with
Genesys and its subsidiaries.
(f) The adjusted exercise price payable for the Genesys
Stock subject to each assumed Forte Option shall be payable in any of
the forms authorized under the Option Agreement applicable to that
option.
(g) In order to exercise each assumed Forte Option, Optionee
must deliver to Genesys a written notice of exercise in which the
number of shares of Genesys Stock to be purchased thereunder must be
indicated. The exercise notice must be accompanied by payment of the
adjusted exercise price payable for the purchased shares of Genesys
Stock and should be delivered to Genesys at the following address:
Genesys Telecommunications Laboratories, Inc.
1155 Market Street
San Francisco, CA 94103
Attention: Ms. Janice Baca Swanson
4. Except to the extent specifically modified by this Option
Assumption Agreement, all of the terms and conditions of each Option Agreement
as in effect immediately prior to the Merger shall continue in full force and
effect and shall not in any way be amended, revised or otherwise affected by
this Stock Option Assumption Agreement.
3
<PAGE>
IN WITNESS WHEREOF, Genesys Telecommunications Laboratories, Inc. has
caused this Stock Option Assumption Agreement to be executed on its behalf by
its duly-authorized officer as of the 30th day of December, 1997.
GENESYS TELECOMMUNICATIONS LABORATORIES, INC.
By:
------------------------------------------
[Name of Company Representative],
[Title]
ACKNOWLEDGMENT
The undersigned acknowledges receipt of the foregoing Stock Option
Assumption Agreement and understands that all rights and liabilities with
respect to each of his or her Forte Options hereby assumed by Genesys
Telecommunications Laboratories, Inc. are as set forth in the Option Agreement,
the Plan and such Stock Option Assumption Agreement.
---------------------------------------------
1, OPTIONEE
DATED: __________________, 199__
4
<PAGE>
EXHIBIT A
Optionee's Outstanding Options to Purchase Shares of
Forte Advanced Management Software, Inc.
Common Stock (Pre-Merger)
Number of Option Shares Exercise Price
----------------------- --------------
2 3
<PAGE>
EXHIBIT B
Optionee's Outstanding Options to Purchase Shares of
Genesys Telecommunications Laboratories, Inc.
Common Stock (Post-Merger)
Number of Option Shares Exercise Price
----------------------- --------------
4 5
