<PAGE> 1
As filed with the Securities and Exchange Commission on _______, 1999
Registration No. __________
-------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
Registration Statement under the Securities Act of 1933
INTUIT INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 77-0034661
(State of incorporation) (I.R.S. employer identification number)
2535 GARCIA AVENUE
MOUNTAIN VIEW, CALIFORNIA 94043
(Address of principal executive offices, including zip code)
OPTIONS GRANTED UNDER THE BOSTON LIGHT SOFTWARE CORP.
1999 AMENDED AND RESTATED STOCK OPTION/STOCK ISSUANCE PLAN AND ASSUMED
BY INTUIT INC.
(Full title of the plan)
CATHERINE L. VALENTINE, ESQ.
INTUIT INC.
P.O. BOX 7850, M.S. 52028
MOUNTAIN VIEW, CALIFORNIA 94039-7850
(650) 944-6656
(Name, address and telephone number of agent for service)
COPIES TO:
Kenneth A. Linhares, Esq.
Fenwick & West LLP
Two Palo Alto Square
Palo Alto, California 94306
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
TITLE OF AMOUNT PROPOSED PROPOSED
SECURITIES TO BE TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE AMOUNT OF
REGISTERED REGISTERED PRICE PER SHARE OFFERING PRICE REGISTRATION FEE
- ---------------- ------------------ ---------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Common Stock 160,970 shares(1) $2.42(2) $389,547.40(2) $108.30(3)
</TABLE>
(1) Shares subject to options assumed as of August 2, 1999.
(2) Weighted average per share exercise price of outstanding options assumed
as of August 2, 1999.
(3) Fee calculated pursuant to Section 6(b) of the Securities Act of 1933, as
amended.
<PAGE> 2
INTUIT INC.
REGISTRATION STATEMENT ON FORM S-8
PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This registration statement relates to 160,970 shares of Common Stock,
$0.01 par value per share, of the Registrant, reserved for issuance on exercise
of options granted under the Boston Light Software Corp. 1999 Amended and
Restated Stock Option/Stock Issuance Plan. The options were assumed by the
Registrant in connection with its acquisition of Boston Light Software Corp. on
August 2, 1999, in accordance with the terms of the Agreement and Plan of Merger
by and among the Registrant, Spyponder Acquisition Corp., Boston Light Software
Corp., and Paul English and Karl Berry, dated as of June 18, 1999.
ITEM 3 INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference:
(a) The Registrant's latest annual report filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), or the latest prospectus
filed by the Registrant pursuant to Rule 424(b) under the
Securities Act of 1933, as amended (the "Securities Act"),
that contains audited financial statements for the
Registrant's latest fiscal year for which such statements have
been filed.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of
the Exchange Act since the end of the fiscal year covered by
the Registrant's annual report or prospectus referred to in
(a) above.
(c) The description of the Registrant's Common Stock contained in
the Registrant's registration statement on Form 8-A filed with
the Commission under Section 12 of the Exchange Act, including
any amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, 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 incorporated by reference herein and to be a part hereof from the date of
the filing of such documents.
ITEM 4 DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5 INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the issuance of the shares of Common Stock offered
hereby will be passed upon for the Registrant by Catherine L. Valentine, Esq.,
Vice President, General Counsel and Secretary of the Registrant. As of August 2,
1999, Ms. Valentine held options to purchase 37,085 shares of Common Stock (of
which 4,530 shares are exercisable within the next 60 days).
The consolidated financial statements and schedule of Registrant
appearing in Registrant's Annual Report (Form 10-K) for the year ended July 31,
1998, have been audited by Ernst & Young LLP, independent auditors, as set forth
in their report thereon included therein and are incorporated herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
2
<PAGE> 3
ITEM 6 INDEMNIFICATION OF DIRECTORS AND OFFICERS
As permitted by Section 145 of the Delaware General Corporation law,
the Registrant's Certificate of Incorporation includes a provision that
eliminates the personal liability of its directors for monetary damages for
breach or alleged breach of their duty of care. In addition, as permitted by
Section 145 of the Delaware General Corporation Law, the Bylaws of the
Registrant provide that: (i) the Registrant is required to indemnify its
directors and officers and persons serving in such capacities in other business
enterprises (including, for example, subsidiaries of the Registrant) at the
Registrant's request, to the fullest extent permitted by Delaware law, including
those circumstances in which indemnification would otherwise be discretionary;
(ii) the Registrant may, in its discretion, indemnify employees and agents in
those circumstances where indemnification is not required by law; (iii) the
Registrant is required to advance expenses, as incurred, to its directors and
officers in connection with defending a proceeding (except that it is not
required to advance expenses to a person against whom the Registrant brings a
claim for breach of the duty of loyalty, for an act or omission not in good
faith, intentional misconduct, a knowing violation of law or deriving an
improper personal benefit from a transaction); (iv) the rights conferred in the
Bylaws are not exclusive and the Registrant is authorized to enter into
indemnification agreements with its directors, officers and employees; and (v)
the Registrant may not retroactively amend the Bylaw provisions in a way that is
adverse to such directors, officers and employees.
The Registrant's policy is to enter into indemnity agreements with each
of its directors and executive officers that provide the maximum indemnity
allowed to directors and executive officers by Section 145 of the Delaware
General Corporation Law and the Bylaws, as well as certain additional procedural
protections. In addition, the indemnity agreements provide that directors and
executive officers will be indemnified to the fullest possible extent not
prohibited by law against all expenses (including attorney's fees) and
settlement amounts paid or incurred by them in any action or proceeding, by
reason of their services as directors or executive officers of the Registrant or
as directors or officers of any other company or enterprise when they are
serving in such capacities at the request of the Registrant. The Registrant will
not be obligated pursuant to the agreements to indemnify or advance expenses to
an indemnified party with respect to proceedings or claims initiated by the
indemnified party and not by way of defense, except with respect to proceedings
specifically authorized by the Board of Directors or brought to enforce a right
of indemnification under the indemnity agreements, the Registrant's Bylaws or
any statute or law. Under the agreements, the Registrant is not obligated to
indemnify the indemnified party: (i) for any expenses incurred by the
indemnified party with respect to any proceeding instituted by the indemnified
party to enforce or interpret the agreement, if a court of competent
jurisdiction determines that each of the material assertions made by the
indemnified party in such proceeding was not made in good faith or was
frivolous; (ii) for any amounts paid in settlement of a proceeding unless the
Registrant consents to such settlement; (iii) with respect to any proceeding or
claim brought by the Registrant against the indemnified party for willful
misconduct, unless a court determines that each of such claims was not made in
good faith or was frivolous; (iv) on account of any suit in which judgment is
rendered against the indemnified party for an accounting of profits made from
the purchase or sale by the indemnified party of securities of the Registrant
pursuant to the provisions of Section 16(b) of the Exchange Act and related
laws; (v) on account of the indemnified party's conduct which is finally
adjudged to have been knowingly fraudulent or deliberately dishonest, or to
constitute willful misconduct or a knowing violation of the law; (vi) on account
of any conduct from which the indemnified party derived an improper personal
benefit; (vii) on account of conduct the indemnified party believed to be
contrary to the best interests of the Registrant or its stockholders; (viii) on
account of conduct that constituted a breach of the indemnified party's duty of
loyalty to the Registrant or its stockholders; or (ix) if a final decision by a
court having jurisdiction in the matter shall determine that such
indemnification is not lawful.
The indemnification provision in the Bylaws, and the indemnity
agreements entered into between the Registrant and its directors and executive
officers, may be sufficiently broad to permit indemnification of the
Registrant's officers and directors for liabilities arising under the Securities
Act.
3
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The indemnity agreements require the Registrant to maintain director
and officer liability insurance to the extent readily available. The
Registration currently carries a director and officer insurance policy.
ITEM 7 EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8 EXHIBITS
<TABLE>
<S> <C>
4.01 Boston Light Software Corp. 1999 Amended and Restated Stock Option/Stock Issuance Plan
4.02 Form of Stock Option Grant Agreements for use under Boston Light Software Corp. 1999 Amended and
Restated Stock Option/Stock Issuance Plan
4.03 Form of Assumption Agreement
4.04(1) Certificate of Incorporation of Intuit dated February 1, 1993
4.05(2) Certificate of Amendment to Intuit's Certificate of Incorporation dated December 14, 1993
4.06(3) Certificate of Amendment to Intuit's Certificate of Incorporation dated January 18, 1996
4.07(4) Certificate of Designations of Series B Junior Participating Preferred Stock dated May 1, 1998
4.08(5) Amended and Restated Rights Agreement, dated October 5, 1998
4.09(5) Certificate of Retirement of Series A Preferred Stock dated September 16, 1998
4.10(6) Bylaws of Intuit, as amended and restated effective April 29, 1998
4.11(5) Form of Specimen Certificate for Intuit's Common Stock
4.12(5) Form of Right Certificate for Series B Junior Participating Preferred Stock
5.01 Opinion of Counsel
23.01 Consent of Counsel (included in Exhibit 5.01)
23.02 Consent of Ernst & Young LLP, Independent Auditors
24.01 Power of Attorney (see page 8)
</TABLE>
- ----------
(1) Filed as an exhibit to Intuit's Registration Statement on Form S-1, filed
with the Commission on February 3, 1993, as amended (File No. 33-57884),
and incorporated by reference.
(2) Filed as an exhibit to Intuit's Form 10-K as originally filed with the
Commission on October 31, 1994, as amended, and incorporated by reference.
(3) Filed as an exhibit to Intuit's Form 10-Q for the quarter ended
January 31, 1996, filed with the Commission on March 15, 1996 and
incorporated by reference.
(4) Filed as an exhibit to Intuit's Registration Statement on Form 8-A filed
with the Commission on May 5, 1998 and incorporated by reference.
(5) Filed as an exhibit to Intuit's Form 10-K for the fiscal year ended
July 31, 1998, filed with the Commission on October 6, 1998 and
incorporated by reference.
4
<PAGE> 5
(6) Filed as an exhibit to Intuit's Form 8-K filed with the Commission on
May 2, 1998 and incorporated by reference.
ITEM 9 UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar value of securities offered would not
exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume
and price represent no more than a twenty percent
(20%) change in the maximum aggregate offering price
set forth in the "Calculation of Registration Fee"
table in the effective registration statement.
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement.
provided, however, that paragraphs (1)(i) and (1)(ii) above do
not apply if the Registration Statement is on Form S-3 or Form
S-8 or Form F-3, and the information required to be included
in a post-effective amendment by those paragraphs is contained
in periodic reports filed with or furnished to the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act
that are incorporated by reference in the Registration
Statement.
(2) That for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein and the offering of such securities
at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Sections 13(a) or 15(d) of the
Exchange Act, (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the Registration Statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described in Item 6
5
<PAGE> 6
hereof, or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered hereby, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
6
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Mountain View, State of California, on August 2,
1999.
INTUIT INC.
By: /s/ Greg J. Santora
------------------------------------
Greg J. Santora
Senior Vice President and
Chief Financial Officer
7
<PAGE> 8
POWER OF ATTORNEY
By signing this Form S-8 below, I hereby appoint each of William H.
Harris, Jr. and Greg J. Santora as my true and lawful attorneys-in-fact and
agents, in my name, place and stead, to sign any and all amendments (including
post-effective amendments) to this Form S-8 registration statement on my behalf,
and to file this Form S-8 registration statement (including all exhibits and
other documents related to the Form S-8 registration statement) with the
Securities and Exchange Commission. I authorize each of my attorneys-in-fact to
(1) appoint a substitute attorney-in-fact for himself and (2) perform any
actions that he believes are necessary or appropriate to carry out the intention
and purpose of this Power of Attorney. I ratify and confirm all lawful actions
taken directly or indirectly by my attorneys-in-fact and by any properly
appointed substitute attorneys-in-fact.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
NAME TITLE DATE
---- ----- ----
<S> <C> <C>
PRINCIPAL EXECUTIVE OFFICER:
/s/ William H. Harris, Jr. President, Chief Executive Officer Aug. 2, 1999
- -------------------------------- and Director
William H. Harris, Jr.
PRINCIPAL FINANCIAL OFFICER AND
PRINCIPAL ACCOUNTING OFFICER:
/s/ Greg J. Santora Senior Vice President and Aug. 2, 1999
- -------------------------------- Chief Financial Officer
Greg J. Santora
ADDITIONAL DIRECTORS:
/s/ William V. Campbell Chairman of the Board of Directors Aug. 2, 1999
- --------------------------------
William V. Campbell
/s/ Christopher W. Brody Director Aug. 2, 1999
- --------------------------------
Christopher W. Brody
/s/ Scott D. Cook Director Aug. 2, 1999
- --------------------------------
Scott D. Cook
Director Aug. __, 1999
- --------------------------------
L. John Doerr
/s/ Donna L. Dubinsky Director Aug. 2, 1999
- --------------------------------
Donna L. Dubinsky
/s/ Michael R. Hallman Director Aug. 2, 1999
- --------------------------------
Michael R. Hallman
/s/ Burton J. McMurtry Director Aug. 2, 1999
- --------------------------------
Burton J. McMurtry
</TABLE>
8
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- -----------
<S> <C>
4.01 Boston Light Software Corp. 1999 Amended and Restated Stock Option/Stock Issuance Plan
4.02 Form of Stock Option Grant Agreements for use under Boston Light Software Corp. 1999 Amended
and Restated Stock Option/Stock Issuance Plan
4.03 Form of Assumption Agreement
4.04(1) Certificate of Incorporation of Intuit dated February 1, 1993
4.05(2) Certificate of Amendment to Intuit's Certificate of Incorporation dated December 14, 1993
4.06(3) Certificate of Amendment to Intuit's Certificate of Incorporation dated January 18, 1996
4.07(4) Certificate of Designations of Series B Junior Participating Preferred Stock dated May 1, 1998
4.08(5) Amended and Restated Rights Agreement, dated October 5, 1998
4.09(5) Certificate of Retirement of Series A Preferred Stock dated September 16, 1998
4.10(6) Bylaws of Intuit, as amended and restated effective April 29, 1998
4.11(5) Form of Specimen Certificate for Intuit's Common Stock
4.12(5) Form of Right Certificate for Series B Junior Participating Preferred Stock
5.01 Opinion of Counsel
23.01 Consent of Counsel (included in Exhibit 5.01)
23.02 Consent of Ernst & Young LLP, Independent Auditors
24.01 Power of Attorney (see page 8)
</TABLE>
- ----------
(1) Filed as an exhibit to Intuit's Registration Statement on Form S-1, filed
with the Commission on February 3, 1993, as amended (File No. 33-57884),
and incorporated by reference.
(2) Filed as an exhibit to Intuit's Form 10-K as originally filed with the
Commission on October 31, 1994, as amended, and incorporated by reference.
(3) Filed as an exhibit to Intuit's Form 10-Q for the quarter ended
January 31, 1996, filed with the Commission on March 15, 1996 and
incorporated by reference.
(4) Filed as an exhibit to Intuit's Registration Statement on Form 8-A filed
with the Commission on May 5, 1998 and incorporated by reference.
(5) Filed as an exhibit to Intuit's Form 10-K for the fiscal year ended
July 31, 1998, filed with the Commission on October 6, 1998 and
incorporated by reference.
(6) Filed as an exhibit to Intuit's Form 8-K filed with the Commission on
May 2, 1998 and incorporated by reference.
<PAGE> 1
Exhibit 4.01
BOSTON LIGHT SOFTWARE CORP.
1999 AMENDED AND RESTATED STOCK OPTION/STOCK ISSUANCE PLAN
1. Purpose. This 1999 Amended and Restated Stock Option/Stock Issuance
Plan (the "Plan") is intended to promote the interests of Boston Light Software
Corp. (the "Company") by giving incentives to the eligible officers and other
employees and directors of and consultants and advisors to the Company, its
parent (if any) and any present or future subsidiaries of the Company
(collectively, "Related Corporations") through providing opportunities to
acquire stock in the Company. As used herein, the terms "parent" and
"subsidiary" mean "parent corporation" and "subsidiary corporation",
respectively, as those terms are defined in Sections 424(e) and 424(f) or
successor provisions of the Internal Revenue Code of 1986 as amended from time
to time (the "Code").
2. Structure of the Plan. The Plan permits the following separate types of
grant:
A. Options may be granted hereunder to purchase shares of common stock of
the Company. These options may meet the requirements of Section 422 of the Code
("Incentive Stock Options" or "ISOs"); or, they may not qualify as ISOs
("Non-Qualified Options"). Both ISOs and Non-Qualified Options are sometimes
referred to hereinafter as "Options".
B. Awards of stock in the Company ("Awards") may be granted.
C. Opportunities to make direct purchases of stock in the Company
("Purchases") may be authorized.
Options, Awards and authorizations to make Purchases are sometimes referred to
hereinafter as "Stock Rights".
3. Administration of the Plan.
A. The Plan shall be administered by the Board of Directors of the Company
(the "Board"). The Board may in its sole discretion grant Options, authorize
Purchases and grant Awards, as provided in the Plan. The Board shall have full
power and authority, subject to the express provisions of the Plan, to construe
and interpret the Plan and all Option agreements, Purchase authorizations and
Award grants thereunder, to establish, amend and rescind such rules and
regulations as it may deem appropriate for the proper administration of the
Plan, to determine in each case the terms and provisions which shall apply to a
particular Option agreement, Purchase authorization, or Award grant, and to make
all other determinations which are, in the Board's judgment, necessary or
desirable for the proper administration of the Plan. The Board may correct any
defect, supply any omission or reconcile any inconsistency in the Plan or in any
Option agreement, Purchase authorization or Award grant in the manner and to the
extent it shall, in its sole discretion, consider expedient. Decisions of the
Board shall be final and
<PAGE> 2
binding on all parties who have an interest in the Plan or any Option, Purchase,
Award, or stock issuance thereunder. No director or person acting pursuant to
authority delegated by the Board shall be liable for any action or determination
under the Plan made in good faith.
B. The Board may, to the full extent permitted by and consistent with
applicable law and the Company's By-laws, and subject to Subparagraph D
hereinbelow, delegate any or all of its powers with respect to the
administration of the Plan to a committee (the "Committee") appointed by the
Board. If a Committee has been appointed, all references in this Plan to the
Board shall mean and relate to that Committee.
C. Those provisions of this Plan which make express reference to Rule
16b-3 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or any successor rule ("Rule 16b-3"), or which are required in order for
certain option transactions to qualify for exemption under Rule 16b-3, shall
apply only to those persons required to file reports under Section 16(a) of the
Exchange Act (a "Reporting Person").
D. If the Company registers any class of equity security under Section 12
of the Exchange Act, the selection of a director or an officer (as the terms
"director" and "officer" are defined for purposes of Rule 16b-3) as a recipient
of an option, the timing of the option grant, the exercise price of the option
and the number of shares subject to the option shall be determined either (i) by
the Board, if all of the Board members are disinterested persons within the
meaning of Rule 16(b)(3), or (ii) by two or more directors having full authority
to act in the matter, each of whom shall be such a disinterested person.
4. Eligible Employees and Others. ISOs may be granted to any employee of
the Company or of any Related Corporation. No person who is not such an employee
may be granted an ISO. Non-Qualified Options, Awards, and authorizations to make
Purchases may be granted to any employee, officer or director of, or consultant
or advisor to the Company or any Related Corporation. The granting of any Stock
Right to any individual or entity shall neither entitle that individual or
entity to, nor disqualify him from, participation in any other grant of Stock
Rights.
5. Stock. The stock subject to Options, Awards and Purchases shall be
authorized but unissued shares of common stock of the Company ("Common Stock"),
or shares of Common Stock reacquired by the Company in any manner. The aggregate
number of shares which may be issued under the Plan is Two Hundred Thirteen
Thousand Fifty (213,050) subject to adjustment as provided in Paragraph 14. If
any Option granted under the Plan shall expire or terminate for any reason
without having been exercised in full or shall cease for any reason to be
exercisable in whole or in part, or if the Company shall reacquire any nonvested
shares issued pursuant to Awards or Purchases, the unpurchased shares subject to
such Option, or such nonvested shares so reacquired shall again be available for
grants of Stock Rights under the Plan.
6. Option Agreements. As a condition to the grant of an Option, each
recipient of an Option shall execute an option agreement in such form not
inconsistent with the Plan as the Board shall approve. These option agreements
may differ among recipients. Each option agreement with respect to an ISO shall
be subject to the provisions of the Plan applicable to
2
<PAGE> 3
ISOs. The Board may, in its sole discretion, include additional provisions in
option agreements, including without limitation restrictions on transfer,
repurchase rights, commitments to pay cash bonuses, to make, arrange for or
guarantee loans or to transfer other property to optionees upon exercise of
options, or such other provisions as shall be determined by the Board; provided,
however, that such additional provisions shall not be inconsistent with any
provision of the Plan and such additional provisions shall not cause any ISO
granted under the Plan to fail to qualify as an incentive stock option within
the meaning of Section 422 of the Code.
7. Option Exercise Price.
A. Subject to Subparagraph 3D of this Plan and Subparagraphs B and C of
this Paragraph 7, the purchase price per share of Common Stock deliverable upon
the exercise of an Option ("exercise price") shall be determined by the Board.
B. In the case of an ISO, the exercise price shall not be less than 100%
of the fair market value of Common Stock, as determined by the Board, at the
time of grant of such option, or less than 110% of such fair market value in the
case of an ISO granted to the owner of stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company or any
Related Corporation (after taking into account the attribution of stock
ownership rules of Section 424(d) of the Code) (a "10% Shareholder").
C. The exercise price of each Non-Qualified Option granted under the Plan
shall in no event be less than the lesser of (i) the book value per share of
Common Stock as of the end of the fiscal year of the Company immediately
preceding the date of grant, or (ii) thirty percent (30%) of the fair market
value per share of Common Stock on the date of grant.
8. Cancellation and New Grant of Options, Etc. The Board shall have the
authority to effect, at any time and from time to time, with the consent of the
affected optionees, (i) the cancellation of any or all outstanding Options and
the grant in substitution therefor of new Options covering the same or different
shares of Common Stock and having an exercise price per share which may be lower
or higher than the exercise price per share of the canceled Options, or (ii)
unless doing so would have the effect of causing an ISO to be treated as a
Non-Qualified Option, the amendment of the terms of any and all outstanding
Options to provide an exercise price per share which is higher or lower than the
then-current exercise price per share of such outstanding Options.
9. Exercise of Options.
A. Each Option granted under the Plan shall be exercisable either in full
or in installments at such time or times and during such period as shall be set
forth in the agreement evidencing the Option, subject to the provisions of the
Plan. Unless doing so would have the effect of causing an ISO to be treated as a
Non-Qualified Option, the Board may, in its sole discretion, (i) accelerate the
date or dates on which all or any particular Option or Options granted under the
Plan may be exercised or (ii) extend the dates during which all, or any
particular, Option or Options granted under the Plan may be exercised.
3
<PAGE> 4
B. Options granted under the Plan may provide for payment of the exercise
price by delivery of cash or a check payable to the order of the Company, or, to
the extent (if at all) provided in the option agreement: (ii) by delivery of a
recourse promissory note of the optionee bearing interest payable not less than
annually at the applicable Federal rate as defined in Section 1274(d) of the
Code and otherwise payable on such terms as are specified by the Board, or (ii)
by any combination of the above methods of payment.
10. Option Period. Subject to earlier termination under other provisions
of this Plan, each Option and all rights thereunder shall expire on such date as
shall be set forth in the applicable option agreement, except that, in the case
of an ISO, such expiration date (the "Expiration Date") shall not be later than
ten years after the date on which the ISO is granted and, in the case of an ISO
granted to a 10% Shareholder as defined in Subparagraph 7B of this Plan, such
expiration date shall not be later than five years after the date on which the
ISO is granted.
11. Nontransferability of Options. ISOs shall not be assignable or
transferable by the optionee, either voluntarily or by operation of law, except
by will or the laws of descent and distribution, and, during the life of the
optionee, shall be exercisable only by the optionee. The foregoing restrictions
shall also apply to Non-Qualified Options except to the extent otherwise
provided in the agreement evidencing the Non-Qualified Option.
12. Effect of Termination of Employment or Other Relationship. Except as
otherwise provided in Paragraph 10 and Subparagraph 13C with respect to ISOs,
and subject to all other provisions of the Plan, the Board shall determine the
period of time during which an optionee may exercise an Option following (i) the
termination of the optionee's employment or other relationship with the Company
or a Related Corporation or (ii) the death or disability of the optionee. Such
periods shall be set forth in the agreement evidencing the Option.
13. Additional ISO Requirements. ISOs granted under the Plan are subject
to the minimum exercise price rules set forth in Subparagraph 7B hereof, the
option period rules of Paragraph 10 hereof, and various other restrictions set
forth elsewhere in this Plan. In addition, ISOs granted under the Plan are
subject to the following:
A. Each ISO granted under the Plan shall, at the time of grant, be
specifically designated as such in the option agreement evidencing such Option.
B. In no event shall the aggregate fair market value (determined at the
time an ISO is granted) of Common Stock for which ISOs granted to any employee
are exercisable for the first time by such employee during any calendar year
(under all stock option plans of the Company and any Related Corporation) exceed
One Hundred Thousand Dollars ($100,000); provided, however, that this
Subparagraph B shall have no force or effect if its inclusion in the Plan is not
necessary for Options issued as ISOs to qualify as incentive stock options
within the meaning of Section 422 of the Code. Any Option which would, but for
its failure to satisfy the foregoing
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<PAGE> 5
restriction, qualify as an ISO shall nevertheless be a valid Option, but to the
extent of such failure it shall be deemed to be a Non-Qualified Option.
C. No ISO may be exercised unless, at the time of such exercise, the
optionee is, and has been continuously since the date of grant of the ISO,
employed by the Company or a Related Corporation, except that:
(i) An ISO may be exercised within the period of three (3) months
after the date the optionee ceases to be an employee of the Company and
any Related Corporation (or within such lesser period as may be specified
in the option agreement); provided, however, that the option agreement may
designate a longer exercise period, in which case the exercise after such
three-month period shall be treated as the exercise of a Non-Qualified
Option.
(ii) If the optionee dies while in the employ of the Company or a
Related Corporation, or within three (3) months after the optionee ceases
to be such an employee of the Company or a Related Corporation, the ISO
may be exercised by the person to whom it is transferred by will or the
laws of descent and distribution within the period of one (1) year after
the date of death (or within such lesser period as may be specified in the
option agreement).
(iii) If the optionee becomes disabled (within the meaning of
Section 22(e)(3) of the Code) while in the employ of the Company or a
Related Corporation, the ISO may be exercised within the period of one (1)
year after the date the optionee's employment ceases because of such
disability (or within such lesser period as may be specified in the option
agreement).
For all purposes of the Plan and any agreement evidencing an Option,
"employment" shall be defined in accordance with the provisions of Treasury
Regulation Section 1.421-7(h) under the Code (or any successor regulations).
Notwithstanding the foregoing provisions, no ISO may be exercised after its
Expiration Date.
14. Adjustments.
A. If, through or as a result of any merger, consolidation, sale of all or
substantially all of the assets of the Company, reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split or other similar transaction, (i) the outstanding shares of Common Stock
are increased, decreased or exchanged for a different number or kind of shares
or other securities of the Company, or (ii) additional shares or new or
different shares or other securities of the Company or other non-cash assets are
distributed with respect to such shares of Common Stock or other securities, an
appropriate and proportionate adjustment shall be made in (a) the maximum number
and kind of shares reserved for issuance under the Plan, (b) the number and kind
of shares or other securities subject to any then outstanding Options under the
Plan, and (c) the price for each share subject to any then outstanding Options
under the Plan, without changing the aggregate purchase price as to which such
Options remain exercisable. No fractional shares
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<PAGE> 6
shall be issued under the Plan on account of any such adjustments.
Notwithstanding the foregoing provisions of this Subparagraph A, no adjustment
shall be made pursuant to this Paragraph 14 if such adjustment would cause any
ISO granted under the Plan to fail to qualify as an incentive stock option
within the meaning of Section 422 of the Code.
B. Any adjustments under this Paragraph 14 shall be made by the Board of
Directors, whose determination as to what adjustments, if any, will be made and
the extent thereof shall be final, binding and conclusive.
15. Rights as a Shareholder. The holder of an Option shall have no rights
as a shareholder with respect to any shares covered by the option (including,
without limitation, any voting rights, the right to inspect or receive the
Company's balance sheets or financial statements or any rights to receive
dividends or non-cash distributions with respect to such shares) until the date
of issue of a stock certificate for such shares. No adjustment shall be made for
dividends or other rights for which the record date is prior to the date such
stock certificate is issued.
16. Merger, Consolidation, Asset Sale, Liquidation, Etc.
A. Except as may otherwise be provided in the applicable option agreement,
in the event of a consolidation or merger or sale of all or substantially all of
the assets of the Company in which outstanding shares of Common Stock are
exchanged for securities, cash or other property of any other corporation or
business entity, or in the event of the liquidation of the Company, the Board,
or the board of directors of any corporation assuming the obligations of the
Company, shall, in its discretion, take any one or more of the following
actions, as to outstanding Options: (i) provide that such Options shall be
assumed, or equivalent options shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof), provided, however, that any
such Options substituted for ISOs shall meet the requirements of Section 424(a)
of the Code; (ii) upon written notice to the optionees, provide that any and all
outstanding Options shall become exercisable in full (to the extent not
otherwise so exercisable) as of a specified date or time ("Accelerated Vesting
Date") prior to the consummation of such transaction, and that all unexercised
Options shall terminate as of a specified date or time ("Accelerated Expiration
Date") following the Accelerated Vesting Date unless exercised by the optionee
prior to the Accelerated Expiration Date; provided, however, that optionees
shall be given a reasonable period of time within which to exercise or provide
for the exercise of outstanding Options following such written notice and before
the Accelerated Expiration Date; or (iii) in the event of a merger under the
terms of which holders of the Common Stock of the Company will receive upon
consummation thereof a cash payment for each share surrendered in the merger
(the "Merger Price"), terminate each outstanding Option in exchange for a
payment, made or provided for by the Company, equal in amount to the excess, if
any, of the Merger Price over the per-share exercise price of each such Option,
times the number of shares of Common Stock subject to such Option. The Board
shall determine the fair market value of a share of Common Stock for purposes of
the foregoing, and the Board's determination of such fair market value shall be
final, binding and conclusive.
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<PAGE> 7
B. The Company may grant Options under the Plan in substitution for
Options held by employees of another corporation who become employees of the
Company or a Related Corporation as the result of a merger or consolidation of
the employing corporation with the Company or a Related Corporation, or as a
result of the acquisition by the Company or a Related Corporation of property or
stock of the employing corporation. The Company may direct that substitute
Options be granted on such terms and conditions as the Board considers
appropriate in the circumstances.
17. Stock Restriction Agreement. As a condition to the grant of an Award
or a Purchase authorization under the Plan, the recipient of the Award or
Purchase authorization shall execute an agreement ("Stock Restriction
Agreement") in such form not inconsistent with the Plan as may be approved by
the Board. Stock Restriction Agreements may differ among recipients. Stock
Restriction Agreements may include any provisions the Board determines should be
included and that are not inconsistent with any provision of the Plan.
18. No Special Employment Rights. Nothing contained in the Plan or in any
option agreement or other agreement or instrument executed pursuant to the
provisions of the Plan shall confer upon any optionee any right with respect to
the continuation of his or her employment by the Company or any Related
Corporation or interfere in any way with the right of the Company or a Related
Corporation at any time to terminate such employment or to increase or decrease
the compensation of the optionee.
19. Other Employee Benefits. Except as to plans which by their terms
include such amounts as compensation, no amount of compensation deemed to be
received by an employee as a result of the grant or exercise of an Option or the
sale of shares received upon such exercise, or as a result of the grant of an
Award or the authorization or making of a Purchase will constitute compensation
with respect to which any other employee benefits of such employee are
determined, including, without limitation, benefits under any bonus, pension,
profit-sharing, life insurance or salary continuation plan, except as otherwise
specifically determined by the Board.
20. Amendment of the Plan.
A. The Board may at any time, and from time to time, modify or amend the
Plan in any respect, except as otherwise expressly provided in this Plan;
provided, however, that if at any time the approval of the shareholders of the
Company is required under the Code with respect to ISOs, or is required under
Rule 16b-3, the Board may not effect such modification or amendment without such
approval.
B. The termination or any modification or amendment of the Plan shall not,
without the consent of an optionee, affect the optionee's rights under an Option
previously granted. With the consent of the optionee affected, the Board may
amend outstanding option agreements in a manner not inconsistent with the Plan.
The Board shall have the right to amend or modify (i) the terms and provisions
of the Plan and of any outstanding ISO granted under the Plan to the extent
necessary to qualify any or all such Options for such favorable federal income
tax treatment (including deferral of taxation upon exercise) as may be afforded
incentive stock options within
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<PAGE> 8
the meaning of Section 422 of the Code, and (ii) the terms and provisions of the
Plan and of any outstanding Option to the extent necessary to ensure the
qualification of the Plan under Rule 16b-3.
21. Investment Representations. The Board may require any person to whom
an Option is granted, as a condition of exercising such Option, and any person
to whom an Award is granted or a Purchase is authorized, as a condition thereof,
to give written assurances in substance and form satisfactory to the Board to
the effect that such person is acquiring the Common Stock subject to the Option,
Award or Purchase for such person's own account for investment and not with any
present intention of selling or otherwise distributing the same, and to such
other effects as the Company deems necessary or appropriate in order to comply
with federal and applicable state securities laws, or with covenants or
representations made by the Company in connection with any public offering of
its Common Stock.
22. Compliance With Securities Laws. Each Option shall be subject to the
requirement that if, at any time, counsel to the Company shall determine that
the listing, registration or qualification of the shares subject to such Option
upon any securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of shares
thereunder, such Option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions acceptable to
the Board. Nothing herein shall be deemed to require the Company to apply for or
to obtain such listing, registration or qualification, or to satisfy such
condition.
23. Withholding. The Company shall have the right to deduct from payments
of any kind otherwise due to the optionee any federal, state or local taxes of
any kind required by law to be withheld with respect to any shares issued upon
exercise of Options under the Plan or upon the grant of an Award, the making of
a Purchase of Common Stock for less than its fair market value, the making of a
Disqualifying Disposition (as defined in Paragraph 24), or the vesting of
restricted Common Stock acquired pursuant to a Stock Right. The Board in its
sole discretion may condition the exercise of an Option, the grant of an Award,
the making of a Purchase, or the vesting of restricted shares acquired by
exercising a Stock Right on the grantee's payment of such additional withholding
taxes.
24. Notice to Company of Disqualifying Disposition. Each employee who
receives an ISO must agree to notify the Company in writing immediately after
the employee makes a Disqualifying Disposition, as hereinafter defined, of any
Common Stock acquired pursuant to the exercise of an ISO. A Disqualifying
Disposition is any disposition (including any sale) of such Common Stock before
the later of (a) two (2) years after the date the employee was granted the ISO
or (b) one (1) year after the date the employee acquired Common Stock by
exercising the ISO. If the employee has died before such stock is sold, these
holding period requirements do not apply and no Disqualifying Disposition can
occur thereafter.
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<PAGE> 9
25. Effective Date and Duration of the Plan.
A. The Plan shall become effective when adopted by the Board, but no Stock
Right granted under the Plan shall become exercisable unless and until the Plan
shall have been approved by the Company's shareholders. If such shareholder
approval is not obtained within twelve months after the date of the Board's
adoption of the Plan, Stock Rights previously granted under the Plan shall not
vest and shall terminate and shall be null and void and no Stock Rights shall be
granted thereafter under the Plan. Amendments to the Plan not requiring
shareholder approval shall become effective when adopted by the Board;
amendments requiring shareholder approval shall become effective when adopted by
the Board, but no stock Right granted after the date of such amendment shall
become exercisable (to the extent that such amendment to the Plan was required
to enable the Company to grant such stock Right to a particular person) unless
and until such amendment shall have been approved by the Company's shareholders.
If such shareholder approval is not obtained within twelve months of the Board's
adoption of such amendment, any Stock Rights granted on or after the date of
such amendment shall terminate and become null and void to the extent that such
amendment was required to enable the Company to grant such Stock Rights to a
particular person. Subject to this limitation, Stock Rights may be granted under
the Plan at any time after the effective date and before the termination date of
the Plan.
B. Unless sooner terminated as provided elsewhere in this Plan, this Plan
shall terminate upon the close of business on the day next preceding the tenth
anniversary of the date of its adoption by the Board. Stock Rights outstanding
on such date shall continue to have force and effect in accordance with the
provisions of the instruments evidencing such Stock Rights.
Adopted by the Board of Directors on February 17, 1999.
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<PAGE> 1
Exhibit 4.02
BOSTON LIGHT SOFTWARE CORP.
INCENTIVE STOCK OPTION AGREEMENT
Boston Light Software Corp., a Massachusetts corporation (the "Company"),
hereby grants as of the ___ day of __________, 19__ (the "Grant Date"), to
__________ (the "Employee"), an option to purchase a maximum of __________
(__________) shares of the Company's Common Stock, no par value per share (the
"Common Stock"), at the price of $_____ per share, on the following terms and
conditions:
1. Grant Under 1999 Amended and Restated Stock Option/Stock Issuance Plan.
(a) This option is granted pursuant to and is governed by and subject to the
Company's 1999 Amended and Restated Stock Option/Stock Issuance Plan (the
"Plan"), the terms and conditions of which are incorporated herein by this
reference. Unless the context otherwise requires, terms used herein shall have
the same meaning as in the Plan. Determinations made pursuant to the Plan in
connection with this option shall be governed by the Plan as it exists on the
date of this option agreement ("Agreement").
(b) The granting of this option shall be subject to receipt by the Company
of the Company's current form of non-disclosure, non-competition and
developments agreement, executed and delivered by the Employee.
2. Grant as Incentive Stock Option, Other Options. This option is intended
to qualify as an incentive stock option ("ISO") within the meaning of Section
422 of the Internal Revenue Code of 1986 (the "Code"). This option is in
addition to any other options heretofore or hereafter granted to the Employee by
the Company, but a duplicate original of this instrument shall not effect the
grant of another option.
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this
Agreement, and subject to all other terms and conditions of this Agreement, if
the Employee has continued to be employed by the Company through any applicable
date in the table below, this option may be exercised prior to the tenth
anniversary of the Grant Date (hereinafter the "Expiration Date") in
installments for not more than the number of shares set forth opposite such
applicable date:
As of the Grant Date _______ shares
As of _____________ _______ shares
As of _____________ an additional __________ shares
As of _____________ an additional __________ shares
As of _____________ an additional __________ shares
As of _____________ an additional __________ shares
As of _____________ an additional __________ shares
<PAGE> 2
The right of exercise shall be cumulative so that if the option is not
exercised to the maximum extent permissible as of an applicable date, it shall
be exercisable, in whole or in part, with respect to all shares not so purchased
at any time prior to the Expiration Date or the earlier termination of this
option. Notwithstanding any other provision of this Agreement or the Plan, this
option may not be exercised at any time on or after the Expiration Date.
(b) Method of Exercise. Subject to the terms and conditions set
forth in this Agreement, this option shall be exercised by the Employee's
delivery of written notice of exercise to the Treasurer of the Company,
specifying the number of shares to be purchased and the purchase price to be
paid therefor and accompanied by payment in full in accordance with Section 4
hereof. Such exercise shall be effective upon receipt by the Treasurer of the
Company of such written notice together with the required payment. The Employee
may purchase less than the number of shares covered hereby, provided that no
partial exercise of this option may be for any fractional share.
(c) Continuous Employment Required. Except as otherwise provided in
this Section 3, this option may not be exercised unless the Employee, at the
time he or she exercises this option, is, and has been at all times since the
Grant Date, an employee of the Company. For all purposes of this Agreement, (i)
"employee" and "employment" shall be defined in accordance with the provisions
of Treasury Regulation Section 1.421-7(h) under the Code, or any successor
regulations, (ii) employment by a parent or subsidiary corporation of the
Company shall be deemed to be employment by the Company and (iii) if this option
shall be assumed or a new option substituted therefor in a transaction to which
Section 424(a) of the Code applies, employment by such assuming or substituting
corporation (hereinafter a "Successor Corporation") shall be considered for all
purposes of this option to be employment by the Company. As used herein, the
terms "parent" and "subsidiary" mean "parent corporation" and "subsidiary
corporation", respectively, as those terms are defined in Sections 424(e) and
424(f) or successor provisions of the Code.
(d) Exercise Period Upon Termination of Employment. If the Employee
ceases to be employed by the Company for any reason, then, except as provided in
paragraphs (e) and (f) below, the right to exercise this option shall terminate
on the date which is three (3) months after the date of cessation of employment
(but in no event after the Expiration Date); provided, however, that this option
shall be exercisable only to the extent that the Employee was entitled to
exercise this option on the date of such cessation. Notwithstanding the
foregoing, if, in the judgment of the Company, the Employee, prior to the
Expiration Date, materially violates the non-competition or confidentiality
provisions of any employment contract, confidentiality and nondisclosure
agreement or other agreement between the Employee and the Company, the right to
exercise this option shall terminate immediately upon written notice to the
Employee from the Company describing such violation.
(e) Exercise Period Upon Death or Disability. If the Employee dies
or becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior
to the Expiration Date while he or she is an employee of the Company, or if the
Employee dies within three (3) months after
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<PAGE> 3
the date on which the Employee ceases to be an employee of the Company (other
than as the result of a discharge for "cause" as specified in Paragraph (f)
below), this option shall be exercisable within the period of one (1) year
following the date of death or disability of the Employee (but in no event after
the Expiration Date), by the Employee or by the person to whom this option is
transferred by will or the laws of descent and distribution; provided, however,
that this option shall be exercisable only to the extent that this option was
exercisable by the Employee on the date of his or her death or disability.
Except as otherwise indicated by the context, the term "Employee", as used in
this Agreement, shall include the estate of the Employee, the Employee's
personal representative, or any other person who acquires the right to exercise
this option by bequest or inheritance or otherwise by reason of the death of the
Employee or by reason of the Employee's incapacity.
(f) Discharge for Cause. If the Employee, prior to the Expiration
Date, is discharged by the Company for "cause" (as defined below), the right to
exercise this option shall terminate immediately upon such discharge. "Cause"
shall mean willful misconduct or willful failure by the Employee to perform his
or her employment responsibilities in the best interests of the Company
(including, without limitation, breach by the Employee of any provision of any
employment, nondisclosure, non-competition or other similar agreement between
the Employee and the Company), as determined by the Company, which determination
shall be conclusive. The Employee shall be considered to have been discharged
"for cause" if the Company determines, within thirty (30) days after the
Employee's resignation, that discharge for cause was warranted.
4. Payment of Purchase Price. Payment of the purchase price for shares
purchased upon exercise of this option shall, at the Employee's election, be
made by delivery to the Company of cash or wire transfer or a check payable to
the order of the Company in an amount equal to the purchase price per share as
hereinabove set forth times the number of shares so purchased (the "exercise
price").
5. Delivery of Shares.
(a) General. The Company shall, upon payment of the exercise price
for the number of shares purchased and paid for, make prompt delivery of such
shares to the Employee; provided, however, that if any law or regulation
requires the Company to take any action with respect to such shares before the
issuance thereof, then the date of delivery of such shares shall be extended for
the period necessary to complete such action.
(b) Listing, Registration, Qualification, Etc. This option shall be
subject to the requirement that if, at any time, counsel to the Company shall
determine that the listing, registration or qualification of the shares subject
hereto upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, or that the
disclosure of non-public information or the satisfaction of any other condition
is necessary as a condition of, or in connection with, the issuance or purchase
of shares hereunder, this option may not be exercised, in whole or in part,
unless such listing, registration, qualification, consent or approval,
disclosure or satisfaction of such other condition shall have
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<PAGE> 4
been effected or obtained on terms acceptable to the Board of Directors of the
Company. Nothing herein shall be deemed to require the Company to apply for,
effect or obtain such listing, registration, qualification, or disclosure, or to
satisfy such other condition.
6. Nontransferability of Option. Except as provided in Paragraph (e) of
Section 3 hereof, this option is personal and no rights granted hereunder may be
transferred, assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) nor shall any such rights be subject to execution,
attachment or similar process. Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this option or of such rights contrary to
the provisions hereof, or upon the levy of any attachment or similar process
upon this option or such rights, this option and such rights shall, at the
election of the Company, become null and void.
7. No Special Employment Rights. Nothing contained in the Plan or this
Agreement shall be construed or deemed by any person under any circumstances to
obligate the Company to continue the employment of the Employee for any period.
8. Rights as a Shareholder. The Employee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to vote or to receive
dividends or other distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Employee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Adjustment Provisions.
(a) General. If through, or as a result of, any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Employee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Paragraph 14 of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under this
Section 9 shall be made by the Board of Directors of the Company, whose
determination as to what adjustments, if any, will be made and the extent
thereof will be final, binding and conclusive. No fractional shares will be
issued with respect to this option on account of any such adjustments.
(c) Limits on Adjustments. No adjustment shall be made under this
Section 9 which would, for purposes of any applicable provision of the Code,
constitute a modification, extension or renewal of this option or a grant of
additional benefits to the Employee.
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<PAGE> 5
10. Mergers, Consolidations, Asset Sales, Liquidations, Etc. In the event
of a consolidation or merger or sale of all or substantially all of the assets
of the Company in which outstanding shares of Common Stock are exchanged for
securities, cash or other property of any other corporation or business entity,
or in the event of the liquidation of the Company, prior to the Expiration Date
or other termination of this option, the Employee shall, with respect to this
option or any unexercised portion hereof, be entitled to the rights and
benefits, and be subject to the limitations, set forth in Paragraph 16 of the
Plan.
11. Withholding of Taxes. The Company's obligation to deliver shares upon
the exercise of this option shall be subject to the Employee's satisfaction of
all applicable federal, state and local income and employment tax withholding
requirements as described in Paragraph 23 of the Plan. Without limiting the
generality of the foregoing, if the Company in its discretion determines that it
is obligated to withhold tax with respect to a Disqualifying Disposition (as
defined in Section 12 hereof), the Employee agrees that the Company may withhold
from the Employee's wages the appropriate amount of federal, state and local
withholding taxes attributable to such Disqualifying Disposition. If any portion
of this option is treated as a Non-Qualified Option, the Employee agrees that
the Company may withhold from the Employee's wages the appropriate amount of
federal, state and local withholding taxes attributable to the Employee's
exercise of such Non-Qualified Option. At the Company's discretion, the amount
required to be withheld may be withheld in cash from such wages, or otherwise as
may be permitted under the Plan. The Employee further agrees that, if the
Company does not withhold an amount from the Employee's wages sufficient to
satisfy the Company's withholding obligation or if such obligation is not
otherwise satisfied, as determined by the Company, the Employee will reimburse
the Company on demand, in cash, for the amount underwithheld.
12. Holding Period Requirements for Incentive Stock Option Shares. It is
understood and intended that this option shall qualify as an "incentive stock
option" as defined in Section 422 of the Code (an "ISO"). Accordingly, the
Employee understands that in order to obtain the beneficial tax treatment
accorded an ISO, no sale or other disposition may be made of any shares acquired
upon exercise of the option within one (1) year after the day of the transfer of
such shares to the Employee, nor within two (2) years after the Grant Date. If
the Employee intends to dispose, or does dispose (whether by sale, exchange,
gift, transfer or otherwise), of any such shares within either of said periods,
he or she will notify the Company in writing within ten (10) days after such
disposition (a "Disqualifying Dispositions").
13. Investment Representations, Warranties and Covenants; Legends.
(a) Representations. The Employee represents, warrants and covenants
that:
(i) Any shares purchased upon exercise of this option shall be
acquired for the Employee's account for investment only and not with a view to,
or for sale in connection with, any distribution of the shares in violation of
the Securities Act of 1933 (the "Securities Act") or any rule or regulation
under the Securities Act.
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<PAGE> 6
(ii) The Employee has had such opportunity as he or she has
deemed adequate to obtain from representatives of the Company such information
as is necessary to permit the Employee to evaluate the merits and risks of his
or her investment in the Company.
(iii) The Employee is able to bear the economic risk of
holding shares acquired pursuant to the exercise of this option for an
indefinite period.
(iv) The Employee understands that (A) the shares acquired
pursuant to the exercise of this option will not be registered under the
Securities Act and are "restricted securities" within the meaning of Rule 144
under the Securities Act; (B) such shares cannot be sold, transferred or
otherwise disposed of unless they are subsequently registered under the
Securities Act or an exemption from registration is then available; (C) in any
event, an exemption from registration under Rule 144 or otherwise under the
Securities Act may not be available for at least two years and even then will
not be available unless a public market then exists for the Common Stock,
adequate information concerning the Company is then available to the public and
other terms and conditions of Rule 144 are complied with; and (D) there is now
no registration statement on file with the Securities and Exchange Commission
with respect to any stock of the Company and the Company has no obligation or
current intention to register any shares acquired pursuant to the exercise of
this option under the Securities Act.
(v) The Employee agrees that, if the Company offers for the
first time any of its Common Stock for sale pursuant to a registration statement
under the Securities Act, the Employee will not, without the prior written
consent of the Company, publicly offer, sell, contract to sell or otherwise
dispose of, directly or indirectly, any shares purchased upon exercise of this
option for a period of ninety (90) days, or such longer period as the Company
may reasonably require, after the effective date of such registration statement.
(vi) The Employee's principal residence is at the address set
forth below on the signature page. The Employee shall promptly notify the
Company of any change in the Employee's principal residence.
By making payment upon any exercise of this option, in whole or in part, the
Employee shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 13.
(b) Legends on Stock Certificates. All stock certificates
representing shares of Common Stock issued to the Employee upon exercise of this
option shall have affixed thereto legends substantially in the following forms,
in addition to any other legends required by applicable state law:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THE SHARES
EVIDENCED BY THIS CERTIFICATE, FILED AND MADE EFFECTIVE UNDER THE
SECURITIES ACT OF 1933, OR AN OPINION OF
6
<PAGE> 7
COUNSEL SATISFACTORY TO THE COMPANY TO THE EFFECT THAT REGISTRATION
UNDER SUCH ACT IS NOT REQUIRED.
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER CONTAINED IN AN OPTION AGREEMENT, A
COPY OF WHICH WILL BE FURNISHED UPON REQUEST BY THE ISSUER.
14. Transfer and Other Restrictions; Company's Purchase Right. Except as
set forth in this Section 14, no disposition (whether by sale, exchange, gift,
transfer or otherwise) may be made of any shares acquired upon exercise of this
option, other than by will or the laws of descent and distribution.
(a) First Refusal Rights.
(i) If the Employee or the Employee's successor in interest
desires to sell all or any part of the shares acquired under this option
(including any securities received in respect thereof pursuant to
recapitalizations and the like), and an offeror (the "Offeror") has made an
offer therefor, which offer the Employee desires to accept, the Employee shall:
(y) obtain in writing an irrevocable and unconditional bona fide offer (the
"Bona Fide Offer") for the purchase thereof from the Offeror; and (z) give
written notice (the "Option Notice") to the President of the Company setting
forth the Employee's desire to sell such shares, which Option Notice shall be
accompanied by a photocopy of the original executed Bona Fide Offer and shall
set forth at least the name and address of the Offeror and the price and terms
of the Bona Fide Offer. Upon receipt of the Option Notice, the Company shall
have an option to purchase any or all of the shares specified in the Option
Notice, such option to be exercisable by giving, within thirty (30) days after
receipt of the Option Notice, a written counter-notice to the Employee. If the
Company elects to purchase, the Employee shall be obligated to sell to the
Company such shares at the price and terms indicated in the Bona Fide Offer
within sixty (60) days from the date of receipt by the Company of the Option
Notice. The Company's purchase rights under this Section 14 are assignable by
the Company.
(ii) Subject to Paragraph 14(b) below, the Employee may sell,
pursuant to the terms of the Bona Fide Offer, any or all of such shares not
purchased by the Company or which the Company does not elect to purchase in the
manner set forth hereinabove after the expiration of the 30-day period during
which the Company may give the aforesaid counter-notice; provided, however, that
the Employee may not sell such shares to the Offeror if the Offeror is (w) a
competitor of the Company, or (x) a person that controls, is controlled by or
under common control with a competitor of the Company, or (y) a member of
management of a competitor of the Company (any person described in clauses (w)
through (y) being hereinafter referred to as a "Competitor") or (z) a person or
entity to which the Board of Directors determines, in its sole discretion, that
a transfer of shares of the Company would be against the Company's best
interest, and the Company gives to the Employee, within thirty (30) days of its
receipt of the Option Notice, written notice stating that the Employee shall not
sell the shares to the Offeror; and provided, further, that prior to the sale of
any such shares to the Offeror, the Offeror shall execute an agreement with the
Company under which the Offeror agrees not to
7
<PAGE> 8
become a Competitor of the Company and further agrees to be subject to the
restrictions set forth in this Agreement. If any or all of such shares are not
sold pursuant to a Bona Fide Offer within the time permitted above, the unsold
shares shall remain subject to the terms of this Agreement.
(iii) The first refusal rights of the Company set forth above
shall remain in effect until the closing of an initial underwritten public
offering of the Company's Common Stock pursuant to a registration statement
filed under the Securities Act of 1933, as amended, or a successor statute, at
which time the first refusal rights set forth herein will automatically expire.
(b) Option to Purchase Upon Termination of Business Relationship.
(i) Option. If the Employee ceases to be employed by the
Company for any reason, the Company shall have the option, exercisable at any
time within thirty (30) days after the later of the date on which the Employee's
employment terminates or the expiration of the applicable exercise period set
forth in Section 3(d), (e) or (f) above, to purchase all or any part of the
Employee's shares purchased under this option. The Company may assign this right
to purchase in its sole discretion. The Company or its assignee(s) shall
exercise the foregoing option by sending written notice to the Employee within
the thirty (30)-day period.
(ii) Purchase Price. The purchase price of any shares to be
sold to the Company and/or its assigns under this paragraph (c) shall be the
fair market value thereof as determined by the Board of Directors as of the date
on which the Employee's employment terminated. Such purchase price shall be
payable in eight (8) equal quarterly payments with interest at the applicable
Federal rate, as defined in Section 1274(d) of the Code, with the first payment
to be made at the closing of a purchase and sale of shares pursuant to
Subparagraph (iii) below, and each subsequent payment to be made at three
(3)-month intervals.
(iii) Settlement. The closing of a purchase and sale of shares
under this Paragraph (c) shall take place at the principal office of the Company
at such time and date as shall be mutually agreed between the Company and the
Employee; provided, that if the parties cannot reach such agreement, settlement
shall be ninety (90) days after the date of termination of the Employee's
employment with the Company (or if such day is a holiday, the first business day
thereafter). At the closing, the Employee shall deliver to the Company (i) the
certificate or certificates representing the shares held by such Employee, duly
endorsed for transfer, or (ii) if such certificate or certificates are already
in the Company's possession, such duly endorsed stock powers as the Company may
request to permit it to record the repurchase by the Company on the records of
the Company.
8
<PAGE> 9
15. Miscellaneous.
(a) Except as otherwise expressly provided herein, this Agreement
may not be amended or otherwise modified unless evidenced in writing and signed
by the Company and the Employee.
(b) All notices under this Agreement shall be delivered by hand,
sent by commercial overnight courier service or sent by registered or certified
mail, return receipt requested, and first-class postage prepaid, to the parties
at their respective addresses set forth beneath their names below or at such
other address as may be designated in a notice by either party to the other.
Notwithstanding the foregoing, any notice sent to such an address in a country
other than that from which the notice is sent may be sent by telefax, telegram
or commercial air courier.
(c) Any reference in this Agreement to a Section of the Code shall
refer to that Section as it reads as of the date of this Agreement and as it may
be amended from time to time, and to any successor provision.
(d) Each provision of this Agreement shall be considered separable.
The invalidity or unenforceability of any provision shall not affect the other
provisions, and this Agreement shall be construed in all respects as if such
invalid or unenforceable provision were omitted.
(e) Sections 12, 13, 14 and 15 hereof shall survive any termination
of this Agreement.
(f) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
(g) The failure of the Company or the Employee to insist upon strict
performance of any provision hereunder, irrespective of the length of time for
which such failure continues, shall not be deemed a waiver of such party's right
to demand strict performance at any time in the future. No consent or waiver,
express or implied, to or of any breach or default in the performance of any
obligation or provision hereunder shall constitute a consent or waiver to or of
any other breach or default in the performance of the same or any other
obligation hereunder.
9
<PAGE> 10
Date of Grant: As of , 19 .
-------------- --
BOSTON LIGHT SOFTWARE CORP.
By:
--------------------------------
Title:
--------------------------------
Address:
60 Lowell Street
Arlington, MA 02476
Employee's Acceptance
The undersigned hereby accepts the foregoing option and agrees to the
terms and conditions of this Agreement. The undersigned hereby acknowledges
receipt of a copy of the Company's 1999 Stock Option/Stock Issuance Plan.
[name of employee]
---------------------------------------
Signature
Address:
---------------------------------------
---------------------------------------
10
<PAGE> 11
Exhibit 4.02
BOSTON LIGHT SOFTWARE CORP.
NON-QUALIFIED STOCK OPTION AGREEMENT
Boston Light Software Corp., a Massachusetts corporation (the "Company"),
hereby grants this ________ day of ________, 19__ (the "Grant Date"), to
____________ (the "Optionee"), an option to purchase a maximum of ________ (___)
shares of the Company's Common Stock, no par value per share (the "Common
Stock"), at the price of $___ per share, on the following terms and conditions:
1. Grant Under 1999 Amended and Restated Stock Option/Stock Issuance Plan.
This option is granted pursuant to and is governed by and subject to the
Company's 1999 Amended and Restated Stock Option/Stock Issuance Plan (the
"Plan"), the terms and conditions of which are incorporated herein by this
reference. Unless the context otherwise requires, terms used herein shall have
the same meaning as in the Plan. Determinations made pursuant to the Plan in
connection with this option shall be governed by the Plan as it exists on the
date of this option agreement ("Agreement").
2. Grant as Non-Qualified Option; Other Options. This option is intended
to be a Non-Qualified Option; it is not intended to qualify as an incentive
stock option within the meaning of Section 422 of the Internal Revenue Code of
1986 (the "Code"). A duplicate original of this instrument shall not effect the
grant of another option.
3. Exercise of Option and Provisions for Termination.
(a) Exercise. Except as otherwise provided in this Agreement, and
subject to all other terms and conditions of this Agreement, if the Optionee has
continued to have a Business Relationship, as that term is defined in Paragraph
(c) of this Section 3, with the Company through any applicable date in the table
below, this option may be exercised prior to the tenth anniversary of the Grant
Date (hereinafter the "Expiration Date") in installments for not more than the
number of shares set forth opposite such applicable date:
As of the Grant Date _______ shares
As of _____________ _______ shares
As of _____________ an additional __________ shares
As of _____________ an additional __________ shares
As of _____________ an additional __________ shares
(b) Method of Exercise. Subject to the terms and conditions set forth in
this Agreement, this option shall be exercised by the Optionee's delivery of
written notice of exercise to the Treasurer of the Company, specifying the
number of shares to be purchased and the purchase price to be paid therefor and
accompanied by payment in full in accordance with
<PAGE> 12
Section 4 hereof. Such exercise shall be effective upon receipt by the Treasurer
of the Company of such written notice together with the required payment. The
Optionee may purchase less than the number of shares covered hereby, provided
that no partial exercise of this option may be for any fractional share.
(c) Continuous Business Relationship Required. Except as otherwise
provided in this Section 3, this option may not be exercised unless the
Optionee, at the time the Optionee exercises this option, is and has been at all
times since the Grant Date, an employee, officer or director of, or consultant
or advisor to the Company (any of such relationships, a "Business
Relationship").
(d) Exercise Period Upon Termination of Business Relationship. If the
Optionee ceases to have a Business Relationship with the Company, then, except
as provided in paragraphs (e) and (f) below, the right to exercise this option
shall terminate on the date which is three (3) months after the date on which
the Optionee ceases to have any Business Relationship with the Company (but in
no event after the Expiration Date); provided, however, that this option shall
be exercisable only to the extent that the Optionee was entitled to exercise
this option on the date of such cessation. Notwithstanding the foregoing, if, in
the judgment of the Company, the Optionee, prior to the Expiration Date,
materially violates the non-competition or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Optionee and the Company, the right to exercise this
option shall terminate immediately upon written notice to the Optionee from the
Company describing such violation.
(e) Exercise Period Upon Death or Disability. If the Optionee is a natural
person who dies or becomes disabled (within the meaning of Section 22(e)(3) of
the Code) prior to the Expiration Date while he or she has a Business
Relationship with the Company, or if such an Optionee dies within three (3)
months after the date on which he or she ceases to have a Business Relationship
with the Company (other than as the result of a discharge for "cause" as
specified in Paragraph (f) below), this option shall be exercisable within the
period of one (1) year following the date of death or disability of the Optionee
(but in no event after the Expiration Date), by the Optionee or by the person to
whom this option is transferred by will or the laws of descent and distribution;
provided, however, that this option shall be exercisable only to the extent that
this option was exercisable by the Optionee on the date of his or her death or
disability. Except as otherwise indicated by the context, the term "Optionee",
as used in this Agreement, shall include the estate of the Optionee, the
Optionee's personal representative, or any other person who acquires the right
to exercise this option by bequest or inheritance or otherwise by reason of the
death of the Optionee or by reason of the Optionee's incapacity.
(f) Discharge for Cause. If the Optionee, prior to the Expiration Date, is
discharged by the Company for "cause" (as defined below), the right to exercise
this option shall, terminate immediately upon such discharge. "Cause" shall mean
willful misconduct or willful failure to perform the Optionee's responsibilities
in the best interests of the Company (including, without limitation, breach by
the Optionee of any provision of any employment, nondisclosure, non-competition
or other similar agreement between the Optionee and the Company), as
2
<PAGE> 13
determined by the Company, which determination shall be conclusive. The Optionee
shall be considered to have been discharged "for cause" if the Company
determines, within thirty (30) days after the Optionee's resignation, that
discharge for cause was warranted.
4. Payment of Purchase Price. Payment of the purchase price for shares
purchased upon exercise of this option shall be made in any of the following
ways: (i) delivery to the Company of cash or wire transfer or a check payable to
the order of the Company in an amount equal to the purchase price per share as
hereinabove set forth times the number of shares so purchased (the "exercise
price"), (ii) by delivery of a recourse promissory note of the Optionee bearing
interest payable not less than annually at the applicable Federal rate as
defined in Section 1274(d) of the Code and otherwise payable on such terms as
are specified by the Board in its sole discretion; or (iii) by any combination
of the above methods of payment.
5. Delivery of Shares.
(a) General. The Company shall, upon payment of the exercise price
for the number of shares purchased and paid for, make prompt delivery of such
shares to the Optionee; provided, however, that if any law or regulation
requires the Company to take any action with respect to such shares before the
issuance thereof, then the date of delivery of such shares shall be extended for
the period necessary to complete such action.
(b) Listing, Registration, Qualification, Etc. This option shall be
subject to the requirement that if, at any time, counsel to the Company shall
determine that the listing, registration or qualification of the shares subject
hereto upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, or that the
disclosure of nonpublic information or the satisfaction of any other condition
is necessary as a condition of, or in connection with, the issuance or purchase
of shares hereunder, this option may not be exercised, in whole or in part,
unless such listing, registration, qualification, consent or approval,
disclosure or satisfaction of such other condition shall have been effected or
obtained on terms acceptable to the Board of Directors of the Company. Nothing
herein shall be deemed to require the Company to apply for, effect or obtain
such listing, registration, qualification, or disclosure, or to satisfy such
other condition.
6. Nontransferability of Option. Except as provided in Paragraph (e) of
Section 3 hereof, this option is personal and no rights granted hereunder may be
transferred, assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) nor shall any such rights be subject to execution,
attachment or similar process. Upon any attempt to transfer, assign, pledge,
hypothecate or otherwise dispose of this option or of such rights contrary to
the provisions hereof, or upon the levy of any attachment or similar process
upon this option or such rights, this option and such rights shall, at the
election of the Company, become null and void.
7. No Special Employment or Other Rights. Nothing contained in the Plan or
this Agreement shall be construed or deemed by any person under any
circumstances to obligate the Company to continue any employment or other
Business Relationship of the Optionee for any period.
3
<PAGE> 14
8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to vote or to receive
dividends or other distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Adjustment Provisions.
(a) General. If through, or as a result of, any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Paragraph 14 of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under this
Section 9 will be made by the Board of Directors of the Company, whose
determination as to what adjustments, if any, will be made and the extent
thereof will be final, binding and conclusive. No fractional shares will be
issued with respect to this option on account of any such adjustments.
10. Mergers, Consolidations, Asset, Sales, Liquidations, Etc. In the event
of a consolidation or merger or sale of all or substantially all of the assets
of the Company in which outstanding shares of Common Stock are exchanged for
securities, cash or other property of any other corporation or business entity,
or in the event of the liquidation of the Company, prior to the Expiration Date
or other termination of this option, the Optionee shall, with respect to this
option or any unexercised portion hereof, be entitled to the rights and
benefits, and be subject to the limitations, set forth in Paragraph 16 of the
Plan.
11. Withholding of Taxes. The Company's obligation to deliver shares upon
the exercise of this option shall be subject to the Optionee's satisfaction of
all applicable federal, state and local income and employment tax withholding
requirements as described in Paragraph 23 of the Plan. Without limiting the
generality of the foregoing, the Optionee agrees that the Company may withhold
from the Optionee's wages the appropriate amount of federal, state and local
withholding taxes attributable to the Optionee's exercise of the option. At the
Company's discretion, and to the extent permitted by the Plan, the amount
required to be withheld may be withheld in cash from such wages, or otherwise as
may be permitted under the Plan. The Optionee further agrees that, if the
Company does not withhold an amount from the Optionee's wages sufficient to
satisfy the Company's withholding obligation or if such obligation is not
otherwise satisfied, as determined by the Company, the Optionee will reimburse
the Company on demand, in cash, for the amount underwithheld.
4
<PAGE> 15
12. Investment Representations, Warranties and Covenants; Legends.
(a) Representations. The Optionee represents, warrants and covenants
that:
(i) Any shares purchased upon exercise of this option shall be
acquired for the Optionee's account for investment only and not with a view to,
or for sale in connection with, any distribution of the shares in violation of
the Securities Act of 1933 (the "Securities Act") or any rule or regulation
under the Securities Act.
(ii) The Optionee has had such opportunity as the Optionee has
deemed adequate to obtain from representatives of the Company such information
as is necessary to permit the Optionee to evaluate the merits and risks of the
Optionee's investment in the Company.
(iii) The Optionee is able to bear the economic risk of holding
shares acquired pursuant to the exercise of this option for an indefinite
period.
(iv) The Optionee understands that (A) the shares acquired pursuant
to the exercise of this option will not be registered under the Securities Act
and are "restricted securities" within the meaning of Rule 144 under the
Securities Act; (B) such shares cannot be sold, transferred or otherwise
disposed of unless they are subsequently registered under the Securities Act or
an exemption from registration is then available; (C) in any event, an exemption
from registration under Rule 144 or otherwise under the Securities Act may not
be available for at least two years and even then will not be available unless a
public market then exists for the Common Stock, adequate information concerning,
the Company is then available to the public and other terms and conditions of
Rule 144 are complied with; and (D) there is now no registration statement on
file with the Securities and Exchange Commission with respect to any stock of
the Company and the Company has no obligation or current intention to register
any shares acquired pursuant to the exercise of this option under the Securities
Act.
(v) The Optionee agrees that, if the Company offers for the first
time any of its Common Stock for sale pursuant to a registration statement under
the Securities Act, the Optionee will not, without the prior written consent of
the Company, publicly offer, sell, contract to sell or otherwise dispose of,
directly or indirectly, any shares purchased upon exercise of this option for a
period of ninety (90) days, or such longer period as the Company may reasonably
require, after the effective date of such registration statement.
(vi) The Optionee's principal residence is at the address set forth
below on the signature page. The Optionee shall promptly notify the Company of
any change in the Optionee's principal address.
By making payment upon any exercise of this option, in whole or in part, the
Optionee shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 12.
5
<PAGE> 16
(b) Legends on Stock Certificates. All stock certificates representing
shares of Common Stock issued to the Optionee upon exercise of this option shall
have affixed thereto legends substantially in the following forms, in addition
to any other legends required by applicable state law:
"THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THE SHARES
EVIDENCED BY THIS CERTIFICATE, FILED AND MADE EFFECTIVE UNDER THE
SECURITIES ACT OF 1933, OR AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY TO THE EFFECT THAT REGISTRATION UNDER SUCH ACT IS NOT
REQUIRED."
"THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER CONTAINED IN AN OPTION AGREEMENT, A
COPY OF WHICH WILL BE FURNISHED UPON REQUEST BY THE ISSUER."
13. Transfer and Other Restrictions; Company's Purchase Rights. Except as
set forth in this Section 13, no disposition (whether by sale, exchange, gift,
transfer or otherwise) may be made of any shares acquired upon exercise of this
option, other than by will or the laws of descent and distribution.
(a) First Refusal Rights.
(i) If the Optionee or the Optionee's successor in interest
desires to sell all or any part of the shares acquired under this option
(including any securities received in respect thereof pursuant to
recapitalizations and the like), and an offeror (the "Offeror") has made an
offer therefor, which offer the Optionee desires to accept, the Optionee shall:
(y) obtain in writing an irrevocable and unconditional bona fide offer (the
"Bona Fide Offer") for the purchase thereof from the Offeror; and (z) give
written notice (the "Option Notice") to the President of Company setting forth
the Optionee's desire to sell such shares, which Option Notice shall be
accompanied by a photocopy of the original executed Bona Fide Offer and shall
set forth at least the name and address of the Offeror and the price and terms
of the Bona Fide Offer. Upon receipt of the Option Notice, the Company shall
have an option to purchase any or all of the shares specified in the Option
Notice, such option to be exercisable by giving, within thirty (30) days after
receipt of the Option Notice, a written counter-notice to the Optionee. If the
Company elects to purchase, the Optionee shall be obligated to sell to the
Company such shares at the price and terms indicated in the Bona Fide Offer
within sixty (60) days from the date of receipt by the Company of the Option
Notice. The Company's purchase rights under this Section 13 are assignable by
the Company.
(ii) Subject to the provisions of Paragraph (b) of this
Section 13, the Optionee may sell, pursuant to the terms of the Bona Fide Offer,
any or all of such shares not purchased by the Company or which the Company does
not elect to purchase in the manner set forth hereinabove after the expiration
of the 30-day period during which the Company may give
6
<PAGE> 17
the aforesaid counter-notice; provided, however, that the Optionee may not sell
such shares to the Offeror if the Offeror is (A) a competitor of the Company, or
(B) a person that controls, is controlled by or under common control with a
competitor of the Company, or (C) a member of management of a competitor of the
Company (any person described in clauses (A) through (C) being hereinafter
referred to as a "Competitor") or (D) a person or entity to which the Board of
Directors determines in its sole discretion, that a transfer of shares of the
Company would be against the Company's best interest, and the Company gives to
the Optionee, within thirty (30) days of its receipt of the Option Notice,
written notice stating that the Optionee shall not sell the shares to the
Offeror; and provided, further, that prior to the sale of any such shares to the
Offeror, the Offeror shall execute an agreement with the Company under which the
Offeror agrees not to become a Competitor of the Company and further agrees to
be subject to the restrictions set forth in this Agreement. If any or all of
such shares are not sold pursuant to a Bona Fide Offer within the time permitted
above, the unsold shares shall remain subject to the terms of this Agreement.
(iii) The first refusal rights of the Company set forth above
shall remain in effect until the closing of an initial underwritten public
offering of the Company's Common Stock pursuant to a registration statement
filed under the Securities Act of 1933, as amended, or a successor statute, at
which time the first refusal rights set forth herein will automatically expire.
(b) Option to Purchase Upon Termination of Business Relationship.
(i) Option. If the Optionee ceases to have a Business
Relationship (as defined in Section 3(c)) with the Company for any reason, the
Company shall have the option, exercisable at any time within thirty (30) days
after the later of the date on which the Optionee's Business Relationship with
the Company terminates or the expiration of the applicable exercise period set
forth in Section 3(d), or (e) or (f) above, to purchase all or any part of the
Optionee's shares purchased under this option. The Company may assign this right
to purchase in its sole discretion. The Company or its assignee(s) shall
exercise the foregoing option by sending written notice to the Optionee within
the thirty (30)-day period.
(ii) Purchase Price. The purchase price of any shares to be
sold to the Company and/or its assigns under this paragraph (c) shall be the
fair market value thereof as determined by the Board of Directors as of the date
on which the Optionee's Business Relationship with the Company terminated. Such
purchase price shall be payable in eight (8) equal quarterly payments with
interest at the applicable Federal rate, as defined in Section 1274(d) of the
Code, with the first payment to be made at the closing of a purchase and sale of
shares pursuant to Subparagraph (iii) below, and each subsequent payment to be
made at [three (3)-month intervals.
(iii) Settlement. The closing of a purchase and sale of shares
under this Paragraph (c) shall take place at the principal office of the Company
at such time and date as shall be mutually agreed between the Company and the
Optionee; provided, that if the parties cannot reach such agreement, settlement
shall be ninety (90) days after the date of termination of the Optionee's
Business Relationship with the Company (or if such day is a holiday, the first
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<PAGE> 18
business day thereafter). At the closing, the Optionee shall deliver to the
Company (i) the certificate or certificates representing the shares held by such
Optionee, duly endorsed for transfer, or (ii) if such certificate or
certificates are already in the Company's possession, such duly endorsed stock
powers as the Company may request to permit it to record the repurchase by the
Company on the records of the Company.
14. Miscellaneous.
(a) Except as otherwise expressly provided herein, this Agreement
may not be amended or otherwise modified unless evidenced in writing and signed
by the Company and the Optionee.
(b) All notices under this Agreement shall be delivered by hand,
sent by commercial overnight courier service or sent by registered or certified
mail, return receipt requested, and first-class postage prepaid, to the parties
at their respective addresses set forth beneath their names below or at such
other address as may be designated in a notice by either party to the other.
Notwithstanding the foregoing, any notice sent to such an address in a country
other than that from which the notice is sent may be sent by telefax, telegram
or commercial air courier.
(c) Any reference in this Agreement to a Section of the Code shall
refer to that Section as it reads as of the date of this Agreement and as it may
be amended from time to time, and to any successor provision.
(d) Each provision of this Agreement shall be considered separable.
The invalidity or unenforceability of any provision shall not affect the other
provisions, and this Agreement shall be construed in all respects as if such
invalid or unenforceable provision were omitted.
(e) Sections 12, 13 and 14 hereof shall survive any termination of
this Agreement.
(f) This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
(g) The failure of the Company or the Optionee to insist upon strict
performance of any provision hereunder, irrespective of the length of time for
which such failure continues, shall not be deemed a waiver of such party's right
to demand strict performance at any time in the future. No consent or waiver,
express or implied, to or of any breach or default in the performance of any
obligation or provision hereunder shall constitute a consent or waiver to or of
any other breach or default in the performance of the same or any other
obligation hereunder.
8
<PAGE> 19
Date of Grant: As of , 19 .
-------------- --
BOSTON LIGHT SOFTWARE CORP.
By:
--------------------------------
Title:
--------------------------------
Address:
60 Lowell Street
Arlington, MA 02476
Optionee's Acceptance
The undersigned hereby accepts the foregoing option and agrees to the
terms and conditions of this Agreement. The undersigned hereby acknowledges
receipt of a copy of the Company's 1999 Amended and Restated Stock Option/Stock
Issuance Plan.
[optionee's name]
---------------------------------------
Signature
Address:
---------------------------------------
---------------------------------------
9
<PAGE> 1
Exhibit 4.03
NOTICE OF OPTION ASSUMPTION AND AMENDMENT AGREEMENT
TO: [insert name of holder]
FROM: Intuit Inc.
DATE:
This Notice of Option Assumption and Amendment Agreement describes the terms of
the assumption by Intuit Inc. ("Intuit") of an option granted to you by Boston
Light Software Corp. ("BLS") and the conversion of that option into an option to
purchase shares of Intuit Common Stock. This Notice and Agreement also details
amendments Intuit made to your option after Intuit assumed it. You will receive
one Notice and Agreement for each assumed option.
Please staple this Notice and Agreement to the Stock Option Agreement that
documents your original Boston Light Software Corp. option (the "BLS Option
Agreement"). All of the terms and conditions of the options are set out in the
BLS Option Agreement, the Stock Option/Stock Issuance Plan under which the
option was originally granted and this Notice and Agreement. No other
documentation detailing the terms of your option or the assumption or amendment
thereof by Intuit will be issued to you.
On August 2, 1999, BLS became a wholly owned subsidiary of Intuit. As a
result of this transaction, your option to purchase shares of BLS under the
option was assumed by Intuit and converted into an option to purchase shares of
Intuit Common Stock (the "Intuit Option"). Intuit also made a number of
amendments to your option. Each amendment was made to provide you with a more
beneficial option. If your option is an incentive stock option, certain
amendments were not made to it because those amendments would have caused the
loss of the tax preferential incentive stock option status. The terms of the
assumption and conversion and the amendments are detailed below.
Assumption and Conversion
The attached Share and Exercise Price Summary shows the number of shares of
Intuit Common Stock subject to your Intuit Option and the exercise price per
share of Intuit Common Stock you must pay to exercise your Intuit Option.
The number of shares of Intuit Common Stock subject to your Intuit Option
and the exercise price per share of your Intuit Option were calculated based on
a conversion ratio that took into account the relative values of Intuit Common
Stock and BLS Common Stock. This conversion ratio and the calculation of the
number of shares and exercise price of your Intuit Option is detailed on the
attached Share and Exercise Price Summary.
<PAGE> 2
Upon the assumption and conversion of the BLS Options by Intuit into Intuit
Options you have no further rights or entitlements under the BLS Options to
acquire BLS shares.
Amendments
Vesting Schedule - The following vesting amendments were made to your
option regardless of whether it is an incentive stock option or a nonqualified
stock option. If your BLS Option provided for quarterly vesting after a one year
cliff, it has been amended to provide for monthly vesting after the one year
cliff. Your option has been amended to provide that 50% of the unvested balance
of your option will become vested and exercisable in the event that your
position with Intuit or BLS is eliminated or you are required to relocate more
than 30 miles from BLS' present location. In addition, your option has been
amended to provide for 100% accelerated vesting in the event that you die or
become totally disabled while you are employed by Intuit.
Permitted Forms of Payment of Exercise Price - Your option may now be
exercised through a same-day-sale commitment with a broker. For more information
on the same-day-sale procedures, please contact [name], Intuit's Stock
Administrator at ______________, or via email at [name]@intuit.com.
Period of Time to Exercise your Option after you Terminate - If your option
is an incentive stock option, the period of time you have to exercise after you
terminate employment has not been amended. If your option is a nonqualified
stock option, the period of time you have to exercise your option after you
terminate for reasons of death or disability has been amended as follows: (a)
for death, your estate can exercise your option for up to a maximum of 18
months; and (b) for disability, you can exercise your option for up to a maximum
of 12 months. In no event may you exercise your option after it has expired.
Private Company Restrictions Removed - The shares you receive on exercise
of your option will be tradeable on the Nasdaq National Market. Accordingly,
those restrictions that were imposed on your BLS Option because BLS Common Stock
was not publicly traded have been removed. Thus, the legend requirements, the
right of first refusal restrictions and the right that BLS reserved to
repurchase shares on your termination have been removed.
The other terms and conditions of your BLS Option remain unchanged.
Registration of Shares
Intuit will file a Form S-8 Registration Statement covering your Intuit
Option and the underlying shares with the United States Securities and Exchange
Commission as soon as practicable after the closing of the acquisition. In
connection with this Form S-8 Registration Statement, a prospectus describing
the material terms of the assumed options will be given to you. NOTE: If you
exercise your Intuit Options before the date on which the S-8 Registration
Statement becomes effective, your shares will be subject to securities laws
restrictions that will prohibit the public sale of the shares for one year.
Accordingly, you should consult with your legal advisor prior to
2
<PAGE> 3
exercising any shares before the effective date of the Form S-8 Registration
Statement. You should also consult your individual tax advisor in connection
with any stock option exercise.
Conclusion
If you have any questions about your Intuit Option, please contact Intuit's
stock option administrator, [name], at (___) ________, or via email at
[name]@intuit.com. By signing below you consent to the terms of the
assumption and conversion of your BLS Options by Intuit into Intuit Options and
the amendments thereto as described above and you agree that you have no further
option or right to BLS shares.
Intuit Inc.
By:
--------------------------------------
Greg J. Santora, Senior Vice President &
Chief Financial Officer
Acknowledged, accepted and agreed:
- -------------------------------------
[optionee]
3
<PAGE> 4
SHARE AND EXERCISE PRICE SUMMARY
Name of Optionee:
--------------------------------------------------
Address:
--------------------------------------------------
Social Insurance #/Social Security #:
----------------------------------------
Date of Grant of
BLS Options:
--------------------------------------------------
Number of BLS Shares
Subject to
BLS Options:
--------------------------------------------------
Multiplied By Conversion Ratio: [INSERT CONVERSION RATIO]
Number of Intuit Shares
Subject to
Intuit Option:
--------------------------------------------------
Exercise Price per Share of
BLS Options:
--------------------------------------------------
Divided By Conversion Ratio: [INSERT CONVERSION RATIO]
Exercise Price per Share of
Intuit Option:
--------------------------------------------------
4
<PAGE> 1
Exhibit 5.01
[INTUIT INC. LETTERHEAD]
August 2, 1999
Securities and Exchange Commission
450 Fifth Street N.W.
Washington, D.C. 20549
Subject: Intuit Inc.
Ladies and Gentlemen
This opinion is provided in connection with a Form S-8 Registration Statement
(the "Registration Statement") being filed by Intuit Inc. (the "Company") on or
about August 2, 1999. The Registration Statement relates to the registration of
160,970 shares of the Company's Common Stock, par value $0.01 per share (the
"Shares"). The Shares have been reserved for issuance upon the exercise of
options granted under the Boston Light Software Corp. 1999 Amended and Restated
Stock Option/Stock Issuance Plan (the "Plan") and assumed by the Company upon
the Company's acquisition of Boston Light Software Corp. The options were
assumed by the Company pursuant to the terms of an Agreement and Plan of Merger
dated as of June 18, 1999 (the "Merger Agreement") by and among the Company,
Spyponder Acquisition Corp., a wholly owned subsidiary of the Company, Boston
Light Software Corp. and Paul English and Karl Berry, and an Assumption
Agreement dated as of August 2, 1999 between the Company and each optionee (the
"Assumption Agreement").
For purposes of this opinion, I have examined copies of (i) the Registration
Statement, (ii) the Certificate of Incorporation of the Company, as amended to
date, (iii) the Bylaws of the Company, as amended to date, (iv) the Plan, (v)
the Merger Agreement, (vi) the form of Assumption Agreement, (vii) resolutions
of the Board of Directors and stockholders of Boston Light Software Corp.
relating to adoption and amendment of the Plan and (viii) resolutions of the
Board of Directors of the Company relating to the Merger Agreement and the
transactions contemplated by the Merger Agreement, including assumption of the
options. In rendering the opinion expressed herein, I have assumed the
genuineness of all signatures, the authenticity of all documents, instruments
and certificates purporting to be originals, the conformity with the original
documents, instruments and certificates of all documents, instruments and
certificates purporting to be copies, and the legal capacity to sign of all
individuals executing documents, instruments and certificates. I have also
assumed that all Shares will be issued pursuant to the Plan for a purchase price
of not less than $0.01 per share.
Based upon and subject to the foregoing and to the effectiveness of the
Registration Statement, I am of the opinion that the Shares that may be issued
by the Company pursuant to the Plan, when issued and paid for in accordance with
the Plan, will be legally issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement. In giving this consent, I do not admit thereby that I come within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended, or the rules and regulations of the Securities and
Exchange Commission.
Very truly yours,
/s/ CATHERINE L. VALENTINE
Catherine L. Valentine
Vice President and General Counsel
<PAGE> 1
Exhibit 23.02
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S8) pertaining to Options granted under the Boston
Light Software Corp. 1999 Amended and Restated Stock Options/Stock Issuance Plan
and assumed by Intuit Inc. and to the incorporation by reference therein of our
report dated August 19, 1998 with respect to the consolidated financial
statements and schedule of Intuit Inc. included in its Annual Report (Form 10-K)
for the year ended July 31, 1998, filed with the Securities and Exchange
Commission.
Palo Alto, California
August 2, 1999
