EXHIBIT 99.3
FILENET CORPORATION
INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN
(As Amended and Restated Through May 20, 2000)
I. PURPOSE OF THE PLAN
This International Employee Stock Purchase Plan is intended to promote the
interests of FileNET Corporation by providing eligible employees of the
Corporation's Foreign Subsidiaries with the opportunity to acquire a proprietary
interest in the Corporation through the purchase of shares of the Corporation's
Common Stock at periodic intervals.
Capitalized terms herein shall have the meanings assigned to such terms in
the attached Appendix. All share numbers in this May 20, 2000 restatement
reflect the 2-for-1 split of Common Stock effected on June 12, 1998.
II. ADMINISTRATION OF THE PLAN
The Plan Administrator shall have full authority to interpret and construe
any provision of the Plan and to adopt such rules and regulations for
administering the Plan as it may deem necessary. Decisions of the Plan
Administrator shall be final and binding on all parties having an interest in
the Plan.
III. STOCK SUBJECT TO PLAN
A. The stock purchasable under the Plan shall be shares of authorized but
unissued or reacquired Common Stock, including shares of Common Stock
purchased on the open market. The maximum number of shares of Common
Stock which may be issued over the term of the Plan and the U.S. Plan
shall be limited to One Million Thirty-Two Thousand Two Hundred and
Seventy Eight (1,032,278) shares and shall consist of the following:
(i) the actual number of shares of Common Stock remaining for issuance
under the Predecessor Plan on the Effective Date (92,278 shares) plus
(ii) an additional Three Hundred Thousand (300,000) shares of Common
Stock effected on May 15, 1998, plus (iii) an additional Three Hundred
Thousand (300,000) shares of Common Stock effected on May 20, 1999,
plus (iv) an additional Three Hundred Forty Thousand (340,000) shares
of Common Stock effected on May 20, 2000.
B. Should any change be made to the Common Stock by reason of any stock
split, stock dividend, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Common
Stock as a class without the Corporation's receipt of consideration,
appropriate adjustments shall be made to (i) the maximum number and
class of securities issuable under the Plan and the U.S. Plan, (ii)
the maximum number and class of securities purchasable per Participant
on any one Purchase Date, (iii) the maximum number and class of
securities purchasable by all Participants in the aggregate on any one
Purchase Date and (iv) the number and class of securities and the
price per share in effect under each outstanding purchase right in
order to prevent the dilution or enlargement of benefits thereunder.
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IV. PURCHASE PERIODS
A. Shares of Common Stock shall be offered for purchase under the Plan
through a series of successive purchase periods until such time as (i)
the maximum number of shares of Common Stock available for issuance
under the Plan shall have been purchased or (ii) the Plan shall have
been sooner terminated.
B. Each purchase period shall have a duration of six (6) months. Purchase
periods shall run from the first business day in May to the last
business day in October each year and from the first business day in
November each year to the last business day in April of the following
year. However, the initial purchase period under the Plan shall begin
on September 1, 1998 and end on the last business day in April 1999.
V. ELIGIBILITY
A. Each individual who is an Eligible Employee on the start date of any
purchase period shall be eligible to participate in the Plan for that
purchase period.
B. To participate in the Plan for a particular purchase period, the
Eligible Employee must complete the enrollment forms prescribed by the
Plan Administrator and file such forms with the Plan Administrator (or
its designate) on or before the start date of the purchase period.
VI. PAYROLL DEDUCTIONS
A. Except to the extent otherwise provided in the Plan (or any addendum
thereto) or authorized by the Plan Administrator, the purchase price
for the shares of Common Stock acquired under the Plan shall be paid
from accumulated payroll deductions authorized by the Participant.
B. The payroll deduction authorized by the Participant for purposes of
acquiring shares of Common Stock under the Plan may be any multiple of
one percent (1%) of the Cash Earnings paid to the Participant during
each purchase period, up to a maximum of ten percent (10%). The
payroll deduction authorized by the Participant shall be collected in
the currency in which paid by the Foreign Subsidiary. The payroll
deductions collected during each purchase period shall be converted
into U.S. Dollars on the Purchase Date for that purchase period on the
basis of the exchange rate in effect on that date. The Plan
Administrator shall have the absolute discretion to determine the
applicable exchange rate to be in effect for each Purchase Date by any
reasonable method that may be based on the exchange rate actually
available in the ordinary course of business on such date. Any changes
or fluctuations in the exchange rate at which the payroll deductions
collected on the Participant's behalf are converted into U.S. Dollars
on each Purchase Date shall be borne solely by the Participant.
C. The rate of payroll deduction so authorized by the Participant shall
continue in effect for the entire purchase period and for each
subsequent purchase period that the Participant remains in the Plan.
The Participant may not increase his or her rate of payroll deduction
2.
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during a purchase period, but may effect such increase as of the start
date of any subsequent purchase period following the filing of a new
payroll deduction authorization with the Plan Administrator. However,
the Participant may, at any time during the purchase period, reduce
his or her rate of payroll deduction to become effective as soon as
possible after filing the appropriate form with the Plan
Administrator. The Participant may not, however, effect more than one
(1) such reduction per purchase period.
D. Payroll deductions shall begin on the first pay day following the
start date of the purchase period and shall (unless sooner terminated
by the Participant) continue through the pay day ending with or
immediately prior to the last day of the purchase period. The amounts
so collected shall be credited to the Participant's book account under
the Plan, initially in the currency in which paid by the Foreign
Subsidiary until converted into U.S. Dollars on the applicable
Purchase Date. Except to the extent otherwise provided by the Plan
(including any addendum thereto) or by the Plan Administrator, no
interest shall be paid on the balance from time to time outstanding in
any book account and the amounts collected from the Participant shall
not be required to be held in any segregated account or trust fund and
may be commingled with the general assets of the Corporation and used
for general corporate purposes.
E. Payroll deductions shall automatically cease upon the termination of
the Participant's purchase right in accordance with the provisions of
the Plan.
F. The Participant's acquisition of Common Stock under the Plan on any
Purchase Date shall neither limit nor require the Participant's
acquisition of Common Stock on any subsequent Purchase Date.
VII. PURCHASE RIGHTS
A. Grant of Purchase Right. A Participant shall be granted a separate
purchase right on the start date of each purchase period in which he
or she participates. The purchase right shall provide the Participant
with the right to purchase shares of Common Stock on the Purchase Date
upon the terms set forth below. The Participant shall execute such
document or documents embodying such terms and such other provisions
(not inconsistent with the Plan) as the Plan Administrator may deem
advisable.
Under no circumstances shall purchase rights be granted under the Plan
to any Eligible Employee if such individual would, immediately after
the grant, own (within the meaning of Code Section 424(d)) or hold
outstanding options or other rights to purchase, stock possessing five
percent (5%) or more of the total combined voting power or value of
all classes of stock of the Corporation or any Corporate Affiliate.
B. Exercise of the Purchase Right. Each purchase right shall be
automatically exercised on the Purchase Date, and shares of Common
Stock shall accordingly be purchased on behalf of each Participant on
such date. The purchase shall be effected by applying the
Participant's payroll deductions (as converted into U.S. Dollars) for
the purchase period ending on such Purchase Date to the purchase of
shares of Common Stock at the purchase price in effect for that
purchase period.
3.
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C. Purchase Price. The U.S. Dollar purchase price per share at which
Common Stock will be purchased on the Participant's behalf on each
Purchase Date shall be equal to eighty-five percent (85%) of the lower
of (i) the Fair Market Value per share of Common Stock on the start
date of the purchase period or (ii) the Fair Market Value per share of
Common Stock on that Purchase Date.
D. Number of Purchasable Shares. The number of shares of Common Stock
purchasable by a Participant on each Purchase Date shall be the number
of whole shares obtained by dividing the amount collected from the
Participant through payroll deductions (as converted into U.S.
Dollars) during the purchase period ending with that Purchase Date by
the purchase price in effect for that period. However, the maximum
number of shares of Common Stock purchasable per Participant on any
one Purchase Date shall not exceed Eight Hundred (800) shares, subject
to periodic adjustments in the event of certain changes in the
Corporation's capitalization. In addition, the maximum number of
shares of Common Stock purchasable by all Participants in the
aggregate on any one Purchase Date under the Plan and the U.S. Plan
shall not exceed One Hundred Seventy Thousand (170,000) shares,
subject to periodic adjustments in the event of certain changes in the
Corporation's capitalization.
E. Excess Payroll Deductions. Any payroll deductions not applied to the
purchase of shares of Common Stock on any Purchase Date because they
are not sufficient to purchase a whole share of Common Stock shall be
held for the purchase of Common Stock on the next Purchase Date.
However, any payroll deductions not applied to the purchase of Common
Stock by reason of the limitation on the maximum number of shares
purchasable by the Participant on the Purchase Date or the limitation
on the maximum number of shares purchasable in the aggregate on the
Purchase Date by all Participants shall be promptly refunded in the
currency in which payroll (from which such deductions were made) was
paid to the Participant by the Foreign Subsidiary.
F. Termination of Purchase Right. The following provisions shall govern
the termination of outstanding purchase rights:
(i) A Participant may, at any time prior to the last fifteen (15)
days of the purchase period, terminate his or her outstanding
purchase right by filing the appropriate form with the Plan
Administrator (or its designate), and no further payroll
deductions shall be collected from the Participant with respect
to the terminated purchase right. Any payroll deductions
collected during the purchase period in which such termination
occurs shall, at the Participant's election, be immediately
refunded in the currency in which payroll (from which such
deductions were made) was paid to the Participant by the Foreign
Subsidiary or held for the purchase of shares on the next
Purchase Date. If no such election is made at the time the
purchase right is terminated, then the payroll deductions
collected with respect to the terminated right shall be refunded
as soon as possible.
(ii) The termination of such purchase right shall be irrevocable, and
the Participant may not subsequently rejoin the purchase period
4.
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for which the terminated purchase right was granted. In order to
resume participation in any subsequent purchase period, such
individual must re-enroll in the Plan (by making a timely filing
of the prescribed enrollment forms) before the start date of the
new purchase period.
(iii)Should the Participant cease to remain an Eligible Employee for
any reason (including death, disability or change in status)
while his or her purchase right remains outstanding, then that
purchase right shall immediately terminate, and all of the
Participant's payroll deductions for the purchase period in which
the purchase right so terminates shall be immediately refunded in
the currency in which payroll (from which such deductions were
made) was paid to the Participant by the Foreign Subsidiary.
However, should the Participant cease to remain in active service
by reason of an approved unpaid leave of absence, then the
Participant shall have the right, exercisable up until the last
business day of the purchase period in which such leave
commences, to (a) withdraw all the payroll deductions collected
to date on his or her behalf during such purchase period or (b)
have such funds held for the purchase of shares on the next
scheduled Purchase Date. In no event, however, shall any further
payroll deductions be collected on the Participant's behalf
during such leave. Upon the Participant's return to active
service (i) within ninety (90) days after the start of the leave
or (ii) prior to the expiration of any longer period during which
his or her re-employment rights are guaranteed by law or
contract, his or her payroll deductions under the Plan shall
automatically resume at the rate in effect at the time the leave
began.
G. Transfer of Employment. In the event that a Participant who is an
Eligible Employee of a Foreign Subsidiary is transferred and becomes
an Eligible Employee of the Corporation during a purchase period under
the Plan, such individual shall continue to remain a Participant in
the Plan and payroll deductions shall continue to be collected until
the next Purchase Date as if the Participant had remained an Eligible
Employee of the Foreign Subsidiary.
In the event that an employee of the Corporation who is a participant
in the U.S. Plan is transferred and becomes an Eligible Employee of a
Foreign Subsidiary during a purchase period in effect under the U.S.
Plan, such individual shall automatically become a Participant under
the Plan for the duration of the purchase period in effect at that
time under the Plan and the balance in such individual's book account
maintained under the U.S. Plan shall be transferred as a balance to a
book account opened for such individual under the Plan. Such balance,
together with all other payroll deductions collected from such
individual by the Foreign Subsidiary for the remainder of the purchase
period under the Plan (as converted into U.S. Dollars), shall be
applied on the next Purchase Date to the purchase of Common Stock
under the Plan.
H. Corporate Transaction. Each outstanding purchase right shall
automatically be exercised, immediately prior to the effective date of
any Corporate Transaction, by applying the payroll deductions of each
Participant for the purchase period in which such Corporate
Transaction occurs, as converted into U.S. Dollars on the basis of the
5.
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exchange rate in effect as determined by the Plan Administrator at the
time of the Corporate Transaction, to the purchase of whole shares of
Common Stock at a purchase price per share equal to eighty-five
percent (85%) of the lower of (i) the Fair Market Value per share of
Common Stock on the start date of the purchase period in which such
Corporate Transaction occurs or (ii) the Fair Market Value per share
of Common Stock immediately prior to the effective date of such
Corporate Transaction. However, the applicable limitation on the
number of shares of Common Stock purchasable per Participant shall
continue to apply to any such purchase, but not the limitation on the
aggregate number of shares purchasable by all Participants.
The Corporation shall use its best efforts to provide at least ten
(10) days prior written notice of the occurrence of any Corporate
Transaction, and Participants shall, following the receipt of such
notice, have the right to terminate their outstanding purchase rights
prior to the effective date of the Corporate Transaction.
I. Proration of Purchase Rights. Should the total number of shares of
Common Stock which are to be purchased pursuant to outstanding
purchase rights on any particular date exceed either (i) the number of
shares then available for issuance under the Plan and the U.S. Plan or
(ii) the maximum number of shares purchasable by all Participants (and
all participants in the U.S. Plan) in the aggregate on that Purchase
Date, then the Plan Administrator shall make a pro-rata allocation of
the available shares on a uniform and nondiscriminatory basis, and the
payroll deductions of each Participant (and each participant in the
U.S. Plan), to the extent in excess of the aggregate purchase price
payable for the Common Stock pro-rated to such individual, shall be
refunded in the currency in which payroll (from which such deductions
were made) was paid to the Participant by the Foreign Subsidiary.
J. Assignability. The purchase right shall be exercisable only by the
Participant and shall not be assignable or transferable by the
Participant.
K. Stockholder Rights. A Participant shall have no stockholder rights
with respect to the shares subject to his or her outstanding purchase
right until the shares are purchased on the Participant's behalf in
accordance with the provisions of the Plan and the Participant has
become a holder of record of the purchased shares.
VIII. ACCRUAL LIMITATIONS
A. No Participant shall be entitled to accrue rights to acquire Common
Stock pursuant to any purchase right outstanding under this Plan if
and to the extent such accrual, when aggregated with (i) rights to
purchase Common Stock accrued under any other purchase right granted
under this Plan and (ii) similar rights accrued under other employee
stock purchase plans (within the meaning of Code Section 423) of the
Corporation or any Corporate Affiliate, would otherwise permit such
Participant to purchase more than Twenty-Five Thousand U.S. Dollars
(U.S.$25,000) worth of stock of the Corporation or any Corporate
Affiliate (determined on the basis of the Fair Market Value of such
stock on the date or dates such rights are granted) for each calendar
year such rights are at any time outstanding.
6.
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B. For purposes of applying such accrual limitations, the following
provisions shall be in effect:
(i) The right to acquire Common Stock under each outstanding purchase
right shall accrue on the Purchase Date in effect for the
purchase period for which such right is granted.
(ii) No right to acquire Common Stock under any outstanding purchase
right shall accrue to the extent the Participant has already
accrued in the same calendar year the right to acquire Common
Stock under one (1) or more other purchase rights at a rate equal
to Twenty-Five Thousand U.S. Dollars (U.S.$25,000) worth of
Common Stock (determined on the basis of the Fair Market Value
per share on the date or dates of grant) for each calendar year
such rights were at any time outstanding.
C. If by reason of such accrual limitations, any purchase right of a
Participant does not accrue for a particular purchase period, then the
payroll deductions which the Participant made during that purchase
period with respect to such purchase right shall be promptly refunded
in the currency in which payroll (from which such deductions were
made) was paid to the Participant by the Foreign Subsidiary.
D. In the event there is any conflict between the provisions of this
Article and one or more provisions of the Plan or any instrument
issued thereunder, the provisions of this Article shall be
controlling.
IX. EFFECTIVE DATE AND TERM OF THE PLAN
A. The Plan was adopted by the Board on July 31, 1998 and shall become
effective on the Effective Date. No purchase rights granted under the
Plan shall be exercised, and no shares of Common Stock shall be issued
hereunder, until the Corporation shall have complied with all
applicable requirements of the 1933 Act (including the registration of
the shares of Common Stock issuable under the Plan on a Form S-8
registration statement filed with the Securities and Exchange
Commission), all applicable listing requirements of any stock exchange
(or the Nasdaq National Market, if applicable) on which the Common
Stock is listed for trading and all other applicable requirements
established by law or regulation.
B. Unless sooner terminated by the Board, the Plan shall terminate upon
the earliest to occur of (i) the last business day in October 2008,
(ii) the date on which all shares available for issuance under the
Plan and the U.S. Plan shall have been sold pursuant to purchase
rights exercised under the Plan and the U.S. Plan or (iii) the date on
which all purchase rights are exercised in connection with a Corporate
Transaction. No further purchase rights shall be granted or exercised,
and no further payroll deductions shall be collected, under the Plan
following such termination.
7.
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X. AMENDMENT OF THE PLAN
The Board may alter, amend, suspend or discontinue the Plan at any time to
become effective immediately following the close of any purchase period.
However, the Board may not, without the approval of the Corporation's
stockholders, (i) increase the number of shares of Common Stock issuable under
the Plan and the U.S. Plan, except for permissible adjustments in the event of
certain changes in the Corporation's capitalization, (ii) alter the purchase
price formula so as to reduce the purchase price payable for the shares of
Common Stock purchasable under the Plan, or (iii) modify the requirements for
eligibility to participate in the Plan.
XI. GENERAL PROVISIONS
A. All costs and expenses incurred in the administration of the Plan
shall be paid by the Corporation.
B. Nothing in the Plan shall confer upon the Participant any right to
continue in the employ of the Corporation or any Corporate Affiliate
for any period of specific duration or interfere with or otherwise
restrict in any way the rights of the Corporation (or any Corporate
Affiliate employing such person) or of the Participant, which rights
are hereby expressly reserved by each, to terminate such person's
employment at any time for any reason, with or without cause.
C. Except to the extent otherwise provided in any addendum to the Plan,
the provisions of the Plan shall be governed by the laws of the State
of California without resort to that State's conflict-of-laws rules.
D. A Foreign Subsidiary or the Plan Administrator, as the case may be,
shall have the right to deduct from any payment to be made under this
Plan, or to otherwise require, prior to the issuance or delivery of
any shares of Common Stock or the payment of any cash, payment by each
Participant of any tax required by applicable law to be withheld.
E. Additional provisions for individual Foreign Subsidiaries may be
incorporated in one or more Addenda to the Plan. Such Addenda shall
have full force and effect with respect to the Foreign Subsidiaries to
which they apply. In the event of a conflict between the provisions of
such an Addendum and one or more other provisions of the Plan, the
provisions of the Addendum shall be controlling.
8.
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Schedule A
Foreign Subsidiaries Participating in
International Employee Stock Purchase Plan
As of September 1, 1998
FileNET Canada, Inc. (Canada)
FileNET France (France)
FileNET GmbH (Germany)
FileNET Company Limited (Ireland)
FileNET BV (Netherlands)
FileNET Limited (United Kingdom)
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Addendum A
FILENET CORPORATION
INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN
PLAN ADDENDUM FOR AUSTRALIAN PARTICIPANTS
The following provision shall apply with respect to the extension of the FileNET
Corporation International Employee Stock Purchase Plan to Participants (the
"Australian Participants") who are Eligible Employees of FileNET Corporation Pty
Limited (ACN 056 639 500) ("FileNET Australia").
Notwithstanding the last sentence of Paragraph D of Article VI, the
amounts collected from an Australian Participant (including amounts
converted into U.S.Dollars on the applicable Purchase Date) shall be
held on trust by FileNET Australia in a specific account established by
FileNET Australia for such purpose and may not be commingled with the
general assets of FileNET Australia or the Corporation or used for
general corporate purposes.
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APPENDIX
The following definitions shall be in effect under the Plan:
A. Board shall mean the Corporation's Board of Directors.
B. Cash Earnings shall mean the (i) base salary payable to a Participant
by one or more Foreign Subsidiaries during such individual's period of
participation in one or more purchase periods under the Plan plus (ii)
all overtime payments, bonuses, commissions, and other incentive-type
payments before deduction of any income or employment taxes. Such Cash
Earnings shall be calculated before deduction of (A) any income or
employment tax withholdings or (B) any pre-tax contributions made by
the Participant to any plan or program now or hereafter established by
the Corporation or any Corporate Affiliate. However, Cash Earnings
shall not include any contributions made on the Participant's behalf
by the Corporation or any Corporate Affiliate to any employee benefit
or welfare plan now or hereafter established.
C. Code shall mean the U.S. Internal Revenue Code of 1986, as amended.
D. Common Stock shall mean the Corporation's common stock.
E. Corporate Affiliate shall mean any parent or subsidiary corporation of
the Corporation (as determined in accordance with Code Section 424),
whether now existing or subsequently established.
F. Corporate Transaction shall mean either of the following
stockholder-approved transactions to which the Corporation is a party:
(i) a merger or consolidation in which securities possessing fifty
percent (50%) or more of the total combined voting power of the
Corporation's outstanding securities are transferred to a person
or persons different from the persons holding those securities
immediately prior to such transaction, or
(ii) the sale, transfer or other disposition of all or substantially
all of the assets of the Corporation in complete liquidation or
dissolution of the Corporation.
G. Corporation shall mean FileNET Corporation, a Delaware corporation and
any corporate successor to all or substantially all of the assets or
voting stock of FileNET Corporation which shall by appropriate action
adopt the Plan.
H. Effective Date shall mean September 1, 1998. Any Foreign Subsidiary
which elects, with the approval of the Board, to extend the benefits
of this Plan to its employees after such Effective Date shall
designate a subsequent Effective Date with respect to its
Participants.
A-1.
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I. Eligible Employee shall mean any person who is employed by a Foreign
Subsidiary on a basis under which he or she is regularly expected to
render more than twenty (20) hours of service per week for more than
five (5) months per calendar year for earnings considered wages under
Code Section 3401(a).
J. Fair Market Value per share of Common Stock on any relevant date shall
be determined in accordance with the following provisions:
(i) If the Common Stock is at the time traded on the Nasdaq National
Market, then the Fair Market Value shall be the average of the
high and low U.S. Dollar selling prices per share of Common Stock
on the date in question, as those prices are reported by the
National Association of Securities Dealers on the Nasdaq National
Market. If there are no selling prices for the Common Stock on
the date in question, then the Fair Market Value shall be the
average of the high and low U.S. Dollar selling prices on the
last preceding date for which such quotations exist.
(ii) If the Common Stock is at the time listed on any Stock Exchange,
then the Fair Market Value shall be the average of the high and
low U.S. Dollar selling prices per share of Common Stock on the
date in question on the Stock Exchange determined by the Plan
Administrator to be the primary market for the Common Stock, as
those prices are officially quoted in the composite tape of
transactions on such exchange. If there are no selling prices for
the Common Stock on the date in question, then the Fair Market
Value shall be the average of the high and low U.S. Dollar
selling prices on the last preceding date for which such
quotations exist.
K. Foreign Subsidiary shall mean any non-U.S. Corporate Affiliate or
Affiliates as may be authorized from time to time by the Board to
extend the benefits of the Plan to their Eligible Employees. The
Foreign Subsidiaries in the Plan as of the Effective Date are listed
in attached Schedule A.
L. 1933 Act shall mean the Securities Act of 1933, as amended.
M. Participant shall mean any Eligible Employee of a Foreign Subsidiary
who is actively participating in the Plan.
N. Plan shall mean the Corporation's International Employee Stock
Purchase Plan, as set forth in this document.
O. Plan Administrator shall mean the committee of two (2) or more
non-employee Board members appointed by the Board to administer the
Plan.
P. Predecessor Plan shall mean the Corporation's 1988 Employee Stock
Purchase Plan to which the U.S. Plan is a successor.
A-2.
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Q. Purchase Date shall mean the last business day of each purchase
period. The initial Purchase Date shall be April 30, 1999.
R. Stock Exchange shall mean either the American Stock Exchange or the
New York Stock Exchange.
S. U.S. Plan shall mean the FileNET Corporation 1998 Employee Stock
Purchase Plan.
A-3.
