<PAGE> 1
As filed with the Securities and Exchange Commission on March 2, 2000.
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
------------------------------------
CONCORD COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Massachusetts 04-2710876
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
600 Nickerson Road
Marlboro, Massachusetts 01752
(508) 460-4646
(Address of Principal Executive Offices) (Zip Code)
------------------------------------
MISSION SYSTEMS, INCORPORATED
1996 EQUITY INCENTIVE STOCK PLAN
FIRSTSENSE SOFTWARE, INC.
1997 STOCK INCENTIVE PLAN
(Full title of the plans)
------------------------------------
John A. Blaeser
Chief Executive Officer and President
Concord Communications, Inc.
600 Nickerson Road
Marlboro, Massachusetts 01752
(508) 460-4646
(Name and address including zip code and telephone number,
including area code, of agent for service)
------------------------------------
Copy to:
Kevin M. Barry, Esq.
TESTA, HURWITZ & THIBEAULT, LLP
125 High Street
Boston, Massachusetts 02110
(617) 248-7000
------------------------------------
<PAGE> 2
================================================================================
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
Proposed
Maximum Proposed
Offering Maximum
Title of Securities Amount to be Price Per Aggregate Amount of
to be Registered Registered Share(1) Offering Price Registration Fee(2)
<S> <C> <C> <C> <C>
MISSION SYSTEMS, INCORPORATED
1996 EQUITY INCENTIVE STOCK PLAN
Common Stock (par value $.01 per share)
OPTIONS GRANTED 1,503 $4.991 $ 7,501.47
387 $4.525 $ 1,751.18
FIRSTSENSE SOFTWARE, INC
1997 STOCK INCENTIVE PLAN
Common Stock (par value $.01 per share)
OPTIONS GRANTED 3,756 $4.991 $ 18,746.20
101,542 $2.329 $236,491.32
67,444 $1.664 $112,226.82
91,330 $0.665 $ 60,734.45
TOTAL: 265,962 $437,451.43 $115.49
</TABLE>
- --------------------------------------------------------------------------------
(1) Such shares are issuable upon exercise of outstanding options with fixed
exercise prices. Pursuant to Rule 457(h), the aggregate offering price and
the fee have been computed upon the basis of the price at which the options
may be exercised. The offering price per share set forth for such shares is
the exercise price per share at which such options are exercisable.
(2) Calculated pursuant to Section 6(b) of the Securities Act of 1933.
<PAGE> 3
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. PLAN INFORMATION.
The documents containing the information specified in this Item 1 will be
sent or given to employees, directors or others as specified by Rule 428(b)(1).
In accordance with the rules and regulations of the Securities and Exchange
Commission (the "Commission") and the instructions to Form S-8, such documents
are not being filed with the Commission either as part of this Registration
Statement or as prospectuses or prospectus supplements pursuant to Rule 424.
Item 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
The documents containing the information specified in this Item 2 will be
sent or given to employees as specified by Rule 428(b). In accordance with the
rules and regulations of the Commission and the instructions to Form S-8, such
documents are not being filed with the Commission either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Commission are incorporated by
reference in this Registration Statement:
(a) The Registrant's Current Report on Form 8-K filed on March 1, 2000
pursuant to the Exchange Act which contains audited financial statements for the
fiscal year ended December 31, 1999.
(b) The Registrant's Current Report on Form 8-K filed on February 10, 2000
pursuant to the Exchange Act;
(c) The Registrant's Current Report on Form 8-K filed on January 26, 2000
pursuant to the Exchange Act;
(d) All other documents filed by the Registrant pursuant to Section 13(a)
or 15(d) of the Exchange Act since the end of the fiscal year covered by the
annual report referred to in (a) above.
(e) The section entitled "Description of Registrant's Securities to be
Registered" contained in the Registrant's Registration Statement on Form 8-A
filed pursuant to Section 12(b) of the Exchange Act on September 12, 1997.
All documents subsequently filed with the Commission 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 herein have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part thereof from the date of filing of such documents.
<PAGE> 4
Item 4. DESCRIPTION OF SECURITIES.
Not applicable.
Item 5. INTEREST OF NAMED EXPERTS AND COUNSEL.
Not applicable.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Restated Articles of Organization of the Registrant and the Restated
By-Laws provide for indemnification of the Registrant's directors and officers
unless such indemnification is prohibited by the Massachusetts Business
Corporation Law. The Massachusetts Business Corporation Law generally permits
indemnification of the Registrant's directors and officers for liabilities and
expenses that they may incur in such capacities, except with respect to any
matter that the indemnified person shall have been adjudicated in any proceeding
not to have acted in good faith in the reasonable belief that his or her action
was in the best interest of the Registrant. Reference is made to the
Registrant's corporate charter filed as Exhibit 3.02 to the Registrant's
Registration Statement on Form S-1 filed with the Commission on August 8, 1997,
as amended (the "S-1") and Restated By-Laws filed as Exhibit 3.03 to the
Registrant's S-1.
Pursuant to an agreement between Charles River Partnership VII Limited
Partnership and Mr. Richard M. Burnes, Jr., Charles River Partnership VII has
agreed to indemnify Mr. Burnes against any liability incurred in his capacity as
a director of the Registrant.
The Registrant has entered into indemnification agreements with its
directors and officers and has obtained directors and officers liability
insurance for the benefit of its directors and officers.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
Item 8. EXHIBITS.
Exhibit No. Description of Exhibit
- ----------- ----------------------
4.1 Restated Articles of Organization (filed as Exhibit 3.02 to the
Registrant's Registration Statement on Form S-1 (File No. 333-33227)
and incorporated herein by reference)
4.2 Restated By-Laws (filed as Exhibit 3.03 to the Registrant's
Registration Statement on Form S-1 (File No. 333-33227) and
incorporated herein by reference)
4.3 Mission Systems, Incorporated 1996 Equity Incentive Stock Plan
4.4 FirstSense Software, Inc. 1997 Stock Incentive Plan
<PAGE> 5
5.1 Opinion of Testa, Hurwitz & Thibeault, LLP (filed herewith)
23.1 Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit 5.1)
23.2 Consent of Arthur Andersen LLP (filed herewith)
24.1 Power of Attorney (included as part of the signature page of this
Registration Statement)
Item 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(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 20
percent 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;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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.
(4) If the registrant is a foreign private issuer, to file a
post-effective amendment to the registration statement to include any
financial statements required by Rule 3-19 of this chapter at the
start of any delayed offering or throughout a continuous offering.
Financial statements and information otherwise required by Section
10(a)(3) of the Act need not be furnished, provided, that the
registrant includes in the prospectus, by means of a post-effective
amendment, financial statements required pursuant to this paragraph
<PAGE> 6
(a)(4) and other information necessary to ensure that all other
information in the prospectus is at least as current as the date of
those financial statements. Notwithstanding the foregoing, with
respect to registration statements on Form F-3, a post-effective
amendment need not be filed to include financial statements and
information required by Section 10(a)(3) of the Act or Rule 3-19 of
this chapter if such financial statements and information are
contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by
reference in the Form F-3.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d)
of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in
the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
<PAGE> 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Concord Communications, Inc., 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 Town of Marlboro, Commonwealth of
Massachusetts, on this 29th day of February, 2000.
CONCORD COMMUNICATIONS, INC.
By: /s/John A. Blaeser
--------------------
John A. Blaeser
Chief Executive Officer and President
POWER OF ATTORNEY
We, the undersigned officers and directors of Concord Communications, Inc.,
hereby severally constitute and appoint John A. Blaeser and Gary E. Haroian, and
each of them singly, our true and lawful attorneys, with full power to them and
each of them singly, to sign for us in our names in the capacities indicated
below, any amendments to this Registration Statement on Form S-8 (including
post-effective amendments), and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, and generally to do all things in our names and on our behalf in our
capacities as officers and directors to enable Concord Communications, Inc., to
comply with the provisions of the Securities Act of 1933, as amended, hereby
ratifying and confirming our signatures as they may be signed by our said
attorneys, or any of them, to said Registration Statement and all amendments
thereto.
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.
SIGNATURE TITLE(S) DATE
--------- -------- ----
/s/ John A. Blaeser Chief Executive Officer, February 29, 2000
- ----------------------------- President and Director
John A. Blaeser (Principal Executive
Officer)
/s/ Gary E. Haroian Senior Vice President, February 29, 2000
- ----------------------------- Finance and
Gary E. Haroian Administration, Chief
Financial Officer, Clerk
and Treasurer (Principal
Financial and Accounting
Officer)
/s/ Frederick W. W. Bolander Director February 29, 2000
- -----------------------------
Frederick W. W. Bolander
/s/ Richard M. Burnes, Jr. Director February 29, 2000
- -----------------------------
Richard M. Burnes, Jr.
/s/ Robert C. Hawk Director February 29, 2000
- -----------------------------
Robert C. Hawk
/s/ John Robert Held Director February 29, 2000
- -----------------------------
John Robert Held
/s/ Deepak Kamra Director February 29, 2000
- -----------------------------
Deepak Kamra
/s/ Robert M. Wadsworth Director February 29, 2000
- -----------------------------
Robert M. Wadsworth
<PAGE> 8
INDEX TO EXHIBITS
Exhibit No. Description
- ----------- -----------
4.1 Restated Articles of Organization (filed as Exhibit 3.02 to the
Registrant's Registration Statement on Form S-1 (File No.
333-33227) and incorporated herein by reference)
4.2 Restated By-Laws (filed as Exhibit 3.03 to the Registrant's
Registration Statement on Form S-1 (File No. 333-33227) and
incorporated herein by reference)
4.3 Mission Systems, Incorporated 1996 Equity Incentive Stock Plan
4.4 FirstSense Software, Inc. 1997 Stock Incentive Plan
5.1 Opinion of Testa, Hurwitz & Thibeault, LLP
23.1 Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit
5.1)
23.2 Consent of Arthur Andersen LLP
24.1 Power of Attorney (included as part of the signature page to this
Registration Statement)
<PAGE> 1
EXHIBIT 4.3
MISSION SYSTEMS, INCORPORATED
1996 EQUITY INCENTIVE STOCK PLAN
1. PURPOSE.
This 1996 Equity Incentive Stock Plan (the "Plan") is intended to provide
incentives: (a) to officers and other employees of Mission Systems, Inc. (the
"Company"), and any present or future parent or subsidiary of the Company
(collectively, "Related Corporations"), by providing them with opportunities to
purchase stock in the Company pursuant to options granted hereunder, which
qualify as "incentive stock options"("ISOs") under Section 422(b) of the
Internal Revenue Code of 1986, as amended (the "Code"); (b) to directors,
officers, employees and consultants of the Company and Related Corporations by
providing them with opportunities to purchase stock in the Company pursuant to
options granted hereunder, which do not qualify as ISOs but as "nonqualified
options" ("NQs") and (c) to directors, officers, employees and consultants of
the Company and Related Corporations by providing them with awards of stock of
the Company "Awards" ). Both ISOs and NQs are referred to hereafter individually
as an "Option" and collectively as "Options". Options and Awards are referred to
hereafter collectively as "Stock Rights". As used herein, the terms "parent" and
"subsidiary" mean "parent corporation" and "subsidiary corporation"
respectively, as those terms are defined in Section 424 of the Code.
2. ADMINISTRATION OF THE PLAN.
A. BOARD OR COMMITTEE ADMINISTRATION.
The Plan shall be administered by the Board of Directors of the Company the
("Board") or by a committee appointed by the Board (the "Committee")
provided that, to the extent required by Rule 16b-3 promulgated under the
Securities Exchange Act of 1934 or any successor provision ("Rule 16b-3"),
with respect to specific grants of Stock Rights, the Plan shall be
administered by a disinterested administrator or administrators within the
meaning of Rule 16b-3. All references to this Plan to the Committee shall
mean the Board if a Committee has not been appointed. Subject to
ratification of the grant of each Stock Right by the Board (if so required
by applicable state law), and subject to the terms of the Plan, the
Committee shall have the authority to (i) determine the employees of the
Company and Related Corporations (subject to paragraph 3) to whom ISOs
shall be granted, and determine (subject to paragraph 3) to whom NQs and
Awards may be granted, (ii) determine the time or times at which Options or
Awards shall be granted (iii) determine the exercise price of shares
subject to each Option, which price shall not be less than the minimum
price specified in paragraph 6; (iv) determine whether each Option granted
shall be an ISO or an NQ (v) determine (subject to paragraph 7) the time or
times when each Option shall become exercisable and the duration of the
exercise period; (vi) determine whether restrictions such as repurchase
options are to be imposed in shares subject to Options and Awards and the
nature of such restrictions, if any, (vii) interpret the
<PAGE> 2
Plan and prescribe and rescind rules and regulations relating to it; and
(viii) resolve any disputes relating to the Plan or any Stock Rights issued
pursuant to the Plan. If the Committee determines to issue an NQ, it shall
take whatever actions it deems necessary, under Section 422 of the Code and
applicable regulations, to ensure that such Option is not treated as an
ISO. The interpretation and construction by the Committee of any provision
of the Plan or any Stock Grant granted under it shall be final unless
otherwise determined by the Board. The Committee may from time to time
adopt such rules and regulations for carrying out the Plan as it may deem
best. No member of the Board or Committee shall be liable for any action or
determination made in good faith with respect to the Plan, or any Stock
Right granted under it.
B. COMMITTEE ACTIONS.
The Committee may select one of its members as chairman and shall hold
meetings at such times and places as it may determine. Acts by a majority
of the members of the Committee, or acts reduced to, or approved in writing
by a majority of the members of the Committee (if consistent with
applicable state law), shall constitute the valid acts of the Committee.
From time to time the Board may increase the size of the Committee and
appoint additional members, remove members (with or without cause) and
appoint members in substitution, fill vacancies however caused, or remove
all members of the Committee and thereafter directly administer the Plan.
3. ELIGIBLE EMPLOYEES AND OTHERS.
ISOs may be granted only to employees of the Company or any Related Corporation.
NQs and Awards may be granted to any employee, officer, director (whether or not
also an employee) or consultant of the Company, or any Related Corporation. The
Committee may take into consideration a recipient's individual circumstances in
determining whether to grant an ISO, an NQ, or an Award. Granting of any Stock
Right to any individual or entity shall neither entitle that individual or
entity to, or disqualify him, her, or it from, participation in any other grant
of Stock Rights.
4. STOCK
The stock subject to Options and Awards shall be authorized but unissued shares
of Class B Common Non-Voting Stock of the Company, no par value per share (the
"Common Stock"), or shares of Common Stock reacquired by the Company in any
manner. The aggregate number of shares which may be issued pursuant to the Plan
is 200,000, subject to adjustments as provided in paragraph 13. If any Stock
Right 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, the unpurchased shares subject to such Stock Right shall
again be available for grants of Stock Rights under the Plan.
5. GRANTING OF STOCK RIGHTS.
Stock Rights may be granted under the Plan at any time after April 25, 1996 and
prior to December 31, 2005. The date of grant of a Stock Right under the plan
will be the date specified
<PAGE> 3
by the Committee at the time it grants the Stock Right, provided, however, that
such date shall not be prior to the date on which the Committee acts to approve
the grant.
6. MINIMUM OPTION PRICE; ISO LIMITATIONS.
A. PRICE FOR NON-QUALIFIED OPTIONS.
The exercise price per share specified in the agreement relating to each NQ
granted under the Plan shall in no event be less than the minimum legal
consideration required therefor under the laws of New Hampshire, or the
laws of any jurisdiction in which the Company or its successors in interest
may be organized.
B. PRICE FOR ISOs.
The exercise price per share specified in the agreement relating to each
ISO granted under the Plan shall not be less than fair market value per
share of Common Stock on the date of such grant. In the case of an ISO
granted to an employee owning stock possessing more than ten percent (10%)
of the total combined voting power of all classes of stock of the Company,
or any Related Corporation, the price per share specified in the agreement
relating to such ISO shall not be less than one hundred ten percent (110%)
of the fair market value per share of Common Stock on the date of grant.
For purposes of determining stock ownership under this paragraph, the rules
of Section 424(d) of the Code shall apply.
C. $100,000 ANNUAL LIMITATION ON ISO VESTING.
Each eligible employee may be granted Options treated as ISOs only to the
extent that, in the aggregate under this Plan and all incentive stock
option plans of the Company and any Related Corporation, ISOs do not become
exercisable for the first time by such employee during any calendar year
with respect to stock having a fair market value (determined at the time
ISOs were granted) in excess of $100,000. The Company intends to designate
any Options granted in excess of such limitations as NQs.
D. DETERMINATION OF FAIR MARKET VALUE.
If, at the time an Option is granted under the Plan, Company's stock is
publicly traded, "fair market value" shall be determined as of the last
business day for which the prices or discussed in this sentence are
available prior to the date such Option is granted and shall mean (i) the
average (on the date) of the high and low prices of the Common Stock on the
principal national securities exchange on which the Common Stock is traded,
if the Common Stock is then traded on a national securities exchange; or
(ii) the last reported sale price (on that date) of the Common Stock on the
NASDAQ National Market List, if the Common Sock is not then traded on a
national securities exchange; or (iii) the closing bid price (or the
average of bid prices ) last quoted (on that date) by an established
quotation service for over-the-counter securities, if the Common Stock is
not reported on the NASDAQ National Market List. However, if the Common
Stock is not
<PAGE> 4
publicly traded at the time an Option is granted under the Plan, "fair
market value" shall be deemed to be the fair value of the Common Stock as
determined by the Committee after taking into consideration all factors
which it deems appropriate, including, without limitation, recent sale and
offer prices of the Common Stock in private transactions negotiated at
arm's length.
7. OPTION DURATION.
Subject to earlier termination as provided in paragraphs 9 and 10, each Option
shall expire on the date specified by the Committee, but not more than (i) ten
(10) years from the date of grant in the case of Options generally, and (ii)
five (5) years from the date of grant in the case of ISOs granted to an employee
owning stock possessing more than then percent (10%) of the total combined
voting power of all classes of stock of the Company, or any Related Corporation,
as determined under paragraph 6(B). Subject to earlier termination as provided
in paragraphs 9 and 10, the term of each ISO shall be the term set forth in the
original instrument granting such ISO, except with respect to any part of such
ISO that is converted into an NQ pursuant to paragraph 16.
8. EXERCISE OF OPTION.
Subject to the provisions of paragraphs 9 through 12, each Option granted under
the Plan shall be exercisable as follows:
A. VESTING.
The Option shall either be fully exercisable on the date of the grant, or
shall become exercisable thereafter in such installments as the Committee
may specify.
B. FULL VESTING OF INSTALLMENTS.
Once an installment becomes exercisable, it shall remain exercisable until
expiration or termination of the Option, unless otherwise specified by the
Committee.
C. PARTIAL EXERCISE.
Each Option or installment may be exercised at any time, or from time to
time, in whole or in part, for up to the total number of shares with
respect to which it is then exercisable.
D. ACCELERATION OF VESTING.
The Committee shall have the right to accelerate the date of exercise of
any installment of any Option, provided that the Committee shall not,
without the consent of the optionee, accelerate the exercise date of any
installment of any Option granted to any employee as an ISO (and not
previously converted into an NQ pursuant to paragraph 16) if such
acceleration would violate the annual vesting limitation contained in
Section 422(d) of the Code, as described in paragraph 6(C).
<PAGE> 5
9. TERMINATION OF EMPLOYMENT.
A. TERMINATION FOR CAUSE OR RESIGNATION.
If an ISO optionee resigns without the written permission of
the Company, or is terminated for cause during the vesting
period of any Option, any such Option shall terminate
immediately, to the extent not previously exercised. Further,
the Company shall have the fight, but not the obligation, to
purchase from the optionee all, or any portion of the shares
obtained pursuant to the Plan, at any reasonable price in
excess of the exercise price, as determined by the Board or
Committee.
B. TERMINATION FOR OTHER THAN DEATH AND DISABILITY.
If an ISO optionee ceases to be employed by the Company and
all Related Corporations other than as defined in paragraph 9
(A) above, or by reason of death or disability as defined in
paragraph 10, no further installments of his ISOs shall become
exercisable, and his / her ISOs shall terminate after the
passage of five (5) business days from the date of termination
of his / her employment, but in no event later than on their
specified expiration dates, except to the extent that such ISO
(or unexercised installment thereof) have been converted into
NQs pursuant to paragraph 16. For the purposes of this
paragraph 9, employment shall be considered as continuing
uninterrupted during any bona fide leave of absence (such as
those attributable to illness, military obligations or
governmental service) provided that the period of such leave
does not exceed ninety (90) days, or, if longer, any period
during which such optionee's reemployment is guaranteed by
statute. A bona fide absence with the written approval of the
Committee shall not be considered an interruption of
employment under this paragraph 9, provided that such written
approval contractually obligates the Company, or any Related
Corporations to continue the employment of the optionee after
the expiration of the approved period of absence. ISOs granted
under the Plan shall not be affected by any change in
employment within, or among the Company and Related
Corporations, so long as the optionee continues to be an
employee of the Company or any Related Corporation. Nothing in
the Plan shall be deemed to give any guarantee of any Stock
Fight the fight to be retained in employment, or other service
by the Company or any Related Corporation for any period of
time.
10. DEATH, DISABILITY.
A. DEATH.
If an ISO optionee ceases to be employed by the Company and
all Related Corporations by reason of his / her death, any ISO
of his / hers may be exercised, to the extent of the number of
shares with respect to which he / she could have exercised it
on the date of his / her death, by his estate, personal
representative or beneficiary, who has acquired the ISO by
will, or by the laws of descent and distribution, at any time
prior to the earlier of the specified expiration date of the
ISO, or 180 days from the date of the optionee's death.
B. DISABILITY.
<PAGE> 6
If an ISO optionee ceases to be employed by the Company and
all Related Corporations by reason of his / her disability
he/she shall have the right to exercise any ISO held by him
her on the date of termination of employment, to the extent
of the number of shares with respect to which he / she could
have exercised it on that date, at any time prior the earlier
of the specified expiration date of the ISO, or 180 days
from the date of the termination of the optionee's
employment. For the purposes of the Plan, the term
"disability" shall mean "permanent and total disability" as
defined in Section 22(e)(3) of the Code or any successor
statute.
11. ASSIGNABILITY.
No Stock Right shall be assignable or transferable by the grantee except by
will, or by the laws of descent and distribution. During the lifetime of the
grantee each Stock Right shall be exercisable only by him / her.
12. TERMS AND CONDITIONS OF OPTIONS.
Options shall be evidenced by instruments (which need not be identical) in such
form as the Committee may from time to time approve. Such instruments shall
conform to the terms and conditions set forth in paragraphs 6 through 11 hereof
and may contain such other provisions as the Committee deems advisable which are
not inconsistent with the Plan, including restrictions applicable to shares of
Common Stock issuable upon exercise of Options. The Committee may specify that
any NQ shall be subject to the restrictions set forth herein with respect to
ISOs, or to such other termination and cancellation provisions as the Committee
may determine. The Committee may from time to time confer authority and
responsibility on one or more of its own members and / or one or more officers
of the Company to execute and deliver such instruments. The proper officers of
the Company are authorized and directed to take any and all actions necessary or
advisable from time to time to carry out the terms of such instruments.
13. ADJUSTMENTS.
Upon the occurrence of any of the following events, an optionee's rights with
respect to Options granted to him / her hereunder, shall be adjusted as
hereinafter provided, unless otherwise specifically provided in the written
agreement between the optionee and the Company relating to such Option:
A. STOCK DIVIDENDS AND STOCK SPLITS.
If the shares of Common Stock shall be subdivided or combined
into a greater or lesser number of shares, or if the Company
shall issue any shares of Common Stock as a stock dividend on
its outstanding Common Stock, the number of shares of Common
Stock deliverable upon the exercise of Options shall be
appropriately increased or decreased proportionately, and
appropriate adjustments shall be made in the purchase price
per share to reflect such subdivision, combination or stock
dividend.
B. CONSOLIDATIONS OR MERGERS.
<PAGE> 7
If the Company is to be consolidated with, or acquired by
another entity in a merger, sale of all, or substantially all
of the Company's assets, or otherwise (an "Acquisition"), the
Committee, or the board of directors of such entity assuming
the obligations of the Company hereunder (the "Successor
Board"), shall, as to outstanding Options, either (i) make
appropriate provisions for the continuation of such Options,
by substituting, on an equitable basis, for the shares then
subject to such Options the consideration payable with respect
to the outstanding shares of Common Stock in connection with
the Acquisition; or (ii) upon written notice to the optionees,
provide that all Options must be exercised, to the extent then
exercisable, within the specified number of days from the date
of such notice; at the end of which period the Options shall
terminate; or (iii) terminate all Options in exchange for a
cash payment equal to the excess of the fair market value of
the shares subject to such Options (to the extent then
exercisable) over the exercise price thereof.
C. RECAPITALIZATION OR REORGANIZATION.
In the event of a recapitalization reorganization of the
Company (other than a transaction described in subparagraph B
above) pursuant to which securities of the Company, or of
another corporation, are issued with respect to the
outstanding shares of Common Stock, an optionee, upon
exercising an Option, shall be entitled to receive, for the
purchase price paid upon such exercise, the securities
he/she would have received, if he / she had exercised his/her
Option prior to such recapitalization, or reorganization.
D. MODIFICATION OF ISOS.
Notwithstanding the foregoing, any adjustments made with
respect to ISOs, pursuant to subparagraph A, B or C above,
shall be made only after the Committee, after consulting with
counsel for the Company, determines whether such adjustments
would constitute a "modification" of such ISOs (as that term
is defined in Section 424 of the Code), or would cause any
adverse tax consequences for the holders of such ISOs. If the
Committee determines that such adjustments made with respect
to ISOs would constitute a modification of such ISOs, or would
cause adverse tax consequences to the holders, it may refrain
from making such adjustments.
E. DISSOLUTION OR LIQUIDATION.
In the event of the proposed dissolution or liquidation of the
Company, each Option will terminate immediately prior to the
consummation of such proposed action, or at such other time
and subject to such other conditions as shall be determined by
the Committee.
F. ISSUANCE OF SECURITIES.
Except as expressly provided herein, no issuance by the
Company of the shares of stock of any class, or securities
convertible into shares of stock of any class of stock, shall
effect, and no adjustments by reason thereof shall affect or
result in an adjustment to the number, or price of shares
subject to Options. No adjustments
<PAGE> 8
shall be made for dividends paid in cash, or in property other
than securities of the Company.
G. FRACTIONAL SHARES.
No fractional shares shall be issued under the Plan and the
optionee shall receive from the Company cash in lieu of such
fractional shares.
H. ADJUSTMENTS.
Upon the happening of any of the events described in
subparagraphs A, B or C above, the class and aggregate number
of shares set forth in subparagraph 4 hereof that are subject
to Stock Rights which previously have been, or subsequently
may be granted under the Plan, shall also be appropriately
adjusted to reflect the events described in such
subparagraphs. The Committee, or the Successor Board, shall
determine the specific adjustments to be made under this
paragraph 13 and, subject to paragraph 2, its determination
shall be conclusive.
14. MEANS OF EXERCISING OPTIONS.
A Stock Right (or any part or installment thereof) shall be exercised by giving
written notice to the Company at its principal office address. Such notice shall
identify the Stock Right being exercised and specify the number of shares as to
which such Stock Right is being exercised, accompanied by full payment of the
purchase price therefor, either (a) in United States dollars, in cash or by
check, (b) at the discretion of the Committee, through delivery of shares of
Common Stock having a fair market value equal, as of the date of exercise, to
the cash exercise price of the Stock Rights, (c) at the discretion of the
Committee, by delivery of the grantee's personal recourse note, bearing interest
payable, not less than annually, at no less than one hundred percent (100%) of
the lowest applicable Federal rate, as defined in Section 1274(d) of the Code,
(d) at the discretion of the Committee and consistent with applicable law,
through the delivery of an assignment to the Company, of a sufficient amount of
the proceeds from the sale of the Common Stock acquired upon exercise of the
Stock Right, and an Authorization to the broker, or selling agent, to pay that
amount to the Company, which sale shall be at the participant's direction at,
the time of the exercise, or (e) at the discretion of the Committee, by any
combination of (a), (b), (c) or (d) above. If the Committee exercises its
discretion to permit payment of the exercise price of an ISO by means of the
methods set forth in clauses (a), (b), (c), (d) or (e) of the preceding
sentence, such discretion shall be exercised in writing at the time of the grant
of the ISO in question. The holder of a Stock Right shall not have the fights of
a shareholder with respect to the shares covered by this Stock Right, until the
date of issuance of a stock certificate to him/ her for such shares. Except as
expressly provided above in paragraph 13, with respect to changes in
capitalization and stock dividends, no adjustment shall be made for dividends,
or similar fights for which the record date is before the date such stock
certificate is issued.
15. TERM AND AMENDMENT OF PLAN.
This Plan was adopted by the Board and shareholder on March 8, 1996 and shall
expire at the end of the day on December 31, 2005 (except as to Options
outstanding on that date). The Board may terminate or amend the Plan at any
time, except that, without the approval of the stockholders obtained within
twelve (12) months before or after the Board adopts the resolution
<PAGE> 9
authorizing any of the following actions, (a) the total number of shares that
may be issued under the Plan may not be increased (except by adjustment pursuant
to paragraph 13), (b) the benefits accruing to participants under the Plan may
not be materially increased, (c) the requirement as to eligibility for
participation in the Plan may not be materially modified; (d) the provisions of
paragraph 3 regarding eligibility for grants of ISOs may not be modified; (e)
the provision of paragraph 6(B) regarding the exercise price at which shares may
be offered pursuant to ISOs may not be modified (except by adjustment pursuant
to paragraph 13); (f) the expiration date of the Plan may not be extended; and
(g) the Board may not take any action which would cause the Plan to fail to
comply with Rule 16b-3. Except as otherwise provided in this paragraph 15, in no
event may action of the Board or the stockholders alter or impair the fights of
the grantee, without his consent, under any Stock Right previously granted to
him.
16. CONVERSION OF ISOS INTO NON-QUALIFIED OPTIONS.
The Committee, at the written request or with the written consent of any
optionee, may in its discretion take such actions as may be necessary to convert
such optionee's ISO's (or any installment or portions of installments thereof)
that have not been exercised on the date of conversion, into NQs, at any time
prior to the expiration of such ISOs, regardless of whether such optionee is an
employee of the Company or a Related Corporation at the time of such conversion.
Such actions may include, but not be limited to, extending the exercise period,
or reducing the exercise price of the appropriate installment of such ISOs. At
the time of such conversion, the Committee (with the consent of the optionee)
may impose such conditions on the exercise of the resulting NQs as the Committee
in its discretion may determine, provided that such conditions shall not be
inconsistent with this Plan. Nothing in the Plan shall be deemed to give the
optionee the right to have such optionee's ISO's converted into NQs and no such
conversion shall occur until and unless the Committee takes appropriate action.
17. APPLICATION OF FUNDS.
The proceeds received by the Company from the sale of shares pursuant to Options
granted under the Plan, shall be used for general corporate purposes.
18. NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION.
By accepting an ISO granted under the Plan, each optionee agrees to notify the
Company in writing immediately after he makes a Disqualifying Disposition (as
described in Sections 421, 422 and 424 of the Code and the regulations
thereunder) of any stock acquired pursuant to the exercise of ISOs granted under
the Plan. A Disqualifying Disposition is generally any disposition occurring
within two years of the date the ISO was granted, or within one year of the date
the ISO was exercised, whichever period ends later.
19. WITHHOLDING OF ADDITIONAL INCOME TAXES.
Upon the exercise of an NQ or the grant of an Award for less than its fair
market value, the making of a Disqualifying Disposition (as defined in paragraph
18), the vesting or transfer of restricted stock or securities acquired on the
exercise of a Stock Right hereunder, or the making of a distribution or other
payment with respect to such stock or securities, the Company may withhold taxes
for amounts that constitute compensation includable in gross income. The
Committee in its discretion may condition (i) the exercise of an Option, (ii)
the grant of an Award, or (iii) the vesting or transferability of restricted
stock or securities acquired by
<PAGE> 10
exercising a Stock Right, on the grantee's making satisfactory arrangement for
such withholding. Such arrangement may include payment by the grantee in cash or
by check of the amount of the withholding taxes or, at the discretion of the
Committee an agreement for the withholding or offset against any compensation
due to grantee by the Company, or, by the grantee's delivery of previously held
shares of Common Stock otherwise deliverable upon exercise of a Stock Right
shares, having an aggregate fair market value equal to the amount of such
withholding taxes.
20. GOVERNMENTAL REGULATION.
The Company's obligation to sell and deliver shares of the Common Stock under
this Plan is subject to the approval of any governmental authority required in
connection with the authorization, issuance or sale of such shares. Government
regulations may impose reporting or other obligations on the Company with
respect to the Plan. For example, the Company may be required to send tax
information statements to employees and former employees that exercise ISOs
under the Plan, and the Company may be required to file tax information returns
reporting the income received by grantees of Stock Rights in connection with the
Plan.
21. GOVERNING LAW: CONSTRUCTION.
The validity and construction of the Plan and the instrument evidencing Stock
Rights shall be governed by the laws of the State of New Hampshire, or the laws
of any jurisdiction in which the Company, or its successors in interest, may be
organized. In construing this Plan, the singular shall include the plural,
unless the context otherwise requires.
<PAGE> 1
EXHIBIT 4.4
FIRSTSENSE SOFTWARE, INC.
1997 STOCK INCENTIVE PLAN
1. PURPOSE
The purpose of this 1997 Stock Incentive Plan (the "Plan") of
FirstSense Software, Inc., a Delaware corporation (the "Company"), is
to advance the interests of the Company's stockholders by enhancing the
Company's ability to attract, retain and motivate persons who make (or
are expected to make) important contributions to the Company by
providing such persons with equity ownership opportunities and
performance-based incentives and thereby better aligning the interests
of such persons with those of the Company's stockholders. Except where
the context otherwise requires, the term "Company" shall include any
present or future subsidiary corporations of FirstSense Software, Inc.,
as defined in Section 424(f) of the Internal Revenue Code of 1986, as
amended, and any regulations promulgated thereunder (the "Code").
2. ELIGIBILITY
All of the Company's employees, officers, directors,
consultants and advisors are eligible to be granted options, restricted
stock, or other stock-based awards (each, an "Award") under the Plan.
Any person who has been granted an Award under the Plan shall be deemed
a "Participant."
3. ADMINISTRATION, DELEGATION
(a) ADMINISTRATION BY BOARD OF DIRECTORS. The Plan will be
administered by the Board of Directors of the Company (the "Board").
The Board shall have authority to grant Awards and to adopt, amend and
repeal such administrative rules, guidelines and practices relating to
the Plan as it shall deem advisable. The Board may correct any defect,
supply any omission or reconcile any inconsistency in the Plan or any
Award in the manner and to the extent it shall deem expedient to carry
the Plan into effect and it shall be the sole and final judge of such
expediency. All decisions by the Board shall be made in the Board's
sole discretion and shall be final and binding on all persons having or
claiming any interest in the Plan or in any Award. No director or
person acting pursuant to the authority delegated by the Board shall be
liable for any action or determination relating to or under the Plan
made in good faith.
(b) DELEGATION TO EXECUTIVE OFFICERS. To the extent permitted
by applicable law, the Board may delegate to one or more executive
officers of the Company the power to make Awards and exercise such
other powers under the Plan as the Board may determine, provided that
the Board shall fix the maximum number of shares subject to Awards and
the maximum number of shares for any one Participant to be made by such
executive officers.
(c) APPOINTMENT OF COMMITTEES. To the extent permitted by
applicable law, the Board may delegate any or all of its powers under
the Plan to one or more committees
<PAGE> 2
or subcommittees of the Board (a "Committee"). If and when the common
stock, $0.01 par value per share, of the Company (the "Common Stock")
is registered under the Securities Exchange Act of 1934 (the "Exchange
Act"), the Board shall appoint one such Committee of not less than two
members, each member of which shall be an "outside director" within the
meaning of Section 162(m) of the Code and a "non-employee director" as
defined in Rule 16b-3 promulgated under the Exchange Act." All
references in the Plan to the "Board" shall mean the Board or a
Committee of the Board or the executive officer referred to in Section
3(b) to the extent that the Board's powers or authority under the Plan
have been delegated to such Committee or executive officer.
4. STOCK AVAILABLE FOR AWARDS
(a) NUMBER OF SHARES. Subject to adjustment under Section
4(b), Awards may be made under the Plan for up to 1,000,000 shares of
Common Stock. If any Award expires or is terminated, surrendered or
canceled without having been fully exercised or is forfeited in whole
or in part or results in any Common Stock not being issued, the unused
Common Stock covered by such Award shall again be available for the
grant of Awards under the Plan, subject, however, in the case of
Incentive Stock Options (as hereinafter defined), to any limitation
required under the Code. Shares issued under the Plan may consist in
whole or in part of authorized but unissued shares or treasury shares.
(b) PER-PARTICIPANT LIMIT. Subject to adjustment under Section
4(c), for Awards granted after the Common Stock is registered under the
Exchange Act, the maximum number of shares with respect to which an
Award may be granted to any Participant under the plan shall be 500,000
per calendar year. The per-participant limit described in this Section
4(b) shall be construed and applied consistently with Section 162(m) of
the Code.
(c) ADJUSTMENT TO COMMON STOCK. In the event of any stock
split, stock dividend, recapitalization, reorganization, merger,
consolidation, combination, exchange of shares, liquidation, spin-off
or other similar change in capitalization or event, or any distribution
to holders of Common Stock other than a normal cash dividend, (i) the
number and class of securities available under this Plan, (ii) the
number and class of security and exercise price per share subject to
each outstanding Option, (iii) the repurchase price per security
subject to each outstanding Restricted Stock Award, and (iv) the terms
of each other outstanding stock-based Award shall be appropriately
adjusted by the Company (or substituted Awards may be made, if
applicable) to the extent the Board shall determine, in good faith,
that such an adjustment (or substitution) is necessary and appropriate.
If this Section 4(c) applies and Section 8(e)(1) also applies to any
event, Section 8(e)(1) shall be applicable to such event, and this
Section 4(c) shall not be applicable.
5. STOCK OPTIONS
(a) GENERAL. The Board may grant options to purchase
Common Stock (each, an "Option") and determine the number of shares of
Common Stock to be covered by each Option, the exercise price of each
Option and the conditions and limitations applicable to the exercise of
each Option, including conditions relating to applicable federal or
state securities laws, as it considers necessary or advisable. An
Option which
<PAGE> 3
is not intended to be an Incentive Stock Option (as hereinafter
defined) shall be designated a "Nonstatutory Stock Option."
(b) INCENTIVE STOCK OPTIONS. An Option that the Board intends
to be an "incentive stock option" as defined in Section 422 of the Code
(an "Incentive Stock Option") shall only be granted to employees of the
Company and shall be subject to and shall be construed consistently
with the requirements of Section 422 of the Code. The Company shall
have no liability to a Participant, or any other party, if an Option
(or any part thereof) which is intended to be an Incentive Stock Option
is not an Incentive Stock Option.
(c) EXERCISE PRICE. The Board shall establish the exercise
price at the time each Option is granted and specify it in the
applicable option agreement.
(d) DURATION OF OPTIONS. Each Option shall be exercisable at
such times and subject to such terms and conditions as the Board may
specify in the applicable option agreement.
(e) EXERCISE OF OPTION. Options may be exercised only by
delivery to the Company of a written notice of exercise signed by the
proper person together with payment in full as specified in Section
5(f) for the number of shares for which the Option is exercised.
(f) PAYMENT UPON EXERCISE. Common Stock purchased upon the
exercise of an Option granted under the Plan shall be paid for as
follows:
(1) in cash or by check, payable to the order of the
Company;
(2) except as the Board may otherwise provide in an
Option Agreement, delivery of an irrevocable and unconditional
undertaking by a creditworthy broker to deliver promptly to the Company
sufficient funds to pay the exercise price, or delivery by the
Participant to the Company of a copy of irrevocable and unconditional
instructions to a creditworthy broker to deliver promptly to the
Company cash or a check sufficient to pay the exercise price;
(3) to the extent permitted by the Board and
explicitly provided in an Option Agreement (i) by delivery of shares of
Common Stock owned by the Participant valued at their fair market value
as determined by the Board in good faith ("Fair Market Value"), which
Common Stock was owned by the Participant at least six months prior to
such delivery, (ii) by delivery of a promissory note of the Participant
to the Company on terms determined by the Board, or (iii) by payment of
such other lawful consideration as the Board may determine; or
(4) any combination of the above permitted forms of
payment.
6. RESTRICTED STOCK
(a) GRANTS. The Board may grant Awards entitling recipients to
acquire shares of Common Stock, subject to the right of the Company to
repurchase all or part of such
<PAGE> 4
shares at their issue price or other stated or formula price (or to
require forfeiture of such shares if issued at no cost) from the
recipient in the event that conditions specified by the Board in the
applicable Award are not satisfied prior to the end of the applicable
restriction period or periods established by the Board for such Award
(each, "Restricted Stock Award").
(b) TERMS AND CONDITIONS. The Board shall determine the terms
and conditions of any such Restricted Stock Award, including the
conditions for repurchase (or forfeiture) and the issue price, if any.
Any stock certificates issued in respect of a Restricted Stock Award
shall be registered in the name of the Participant and, unless
otherwise determined by the Board, deposited by the Participant,
together with a stock power endorsed in blank, with the Company (or its
designee). At the expiration of the applicable restriction periods, the
Company (or such designee) shall deliver the certificates no longer
subject to such restrictions to the Participant or if the Participant
has died, to the beneficiary designated, in a manner determined by the
Board, by a Participant to receive amounts due or exercise rights of
the Participant in the event of the Participant's death (the
"Designated Beneficiary"). In the absence of an effective designation
by a Participant, Designated Beneficiary shall mean the Participant's
estate.
7. OTHER STOCK-BASED AWARDS
The Board shall have the right to grant other Awards based
upon the Common Stock having such terms and conditions as the Board may
determine, including the grant of shares based upon certain conditions,
the grant of securities convertible into Common Stock and the grant of
stock appreciation rights.
8. GENERAL PROVISIONS APPLICABLE TO AWARDS
(a) TRANSFERABILITY OF AWARDS. Except as the Board may
otherwise determine or provide in an Award, Awards shall not be sold,
assigned, transferred, pledged or otherwise encumbered by the person to
whom they are granted, either voluntarily or by operation of law,
except by will or the laws of descent and distribution, and, during the
life of the Participant, shall be exercisable only by the Participant.
References to a Participant, to the extent relevant in the context,
shall include references to authorized transferees.
(b) DOCUMENTATION. Each Award under the Plan shall be
evidenced by a written instrument in such form as the Board shall
determine. Each Award may contain terms and conditions in addition to
those set forth in the Plan.
(c) BOARD DISCRETION. Except as otherwise provided by the
Plan, each type of Award may be made alone or in addition or in
relation to any other type of Award. The terms of each type of Award
need not be identical, and the Board need not treat Participants
uniformly.
(d) TERMINATION OF STATUS. The Board shall determine the
effect on an Award of the disability, death, retirement, authorized
leave of absence or other change in the employment or other status of a
Participant and the extent to which, and the period during
<PAGE> 5
which, the Participant, the Participant's legal representative,
conservator, guardian or Designated Beneficiary may exercise rights
under the Award.
(e) ACQUISITION EVENTS
(1) CONSEQUENCES OF ACQUISITION EVENTS. Upon the
occurrence of an Acquisition Event (as defined below), or the execution
by the Company of any agreement with respect to an Acquisition Event,
the Board shall take any one or more of the following actions with
respect to then outstanding Awards: (i) provide that outstanding
Options shall be assumed, or equivalent Options shall be substituted,
by the acquiring or succeeding corporation (or an affiliate thereof),
provided that any such Options substituted for Incentive Stock Options
shall satisfy, in the determination of the Board, the requirements of
Section 424(a) of the Code; (ii) upon written notice to the
Participants, provide that all then unexercised Options will become
exercisable in full as of a specified time (the "Acceleration Time")
prior to the Acquisition Event and will terminate immediately prior to
the consummation of such Acquisition Event, except to the extent
exercised by the Participants between the Acceleration Time and the
consummation of such Acquisition Event; (iii) in the event of an
Acquisition Event under the terms of which holders of Common Stock will
receive upon consummation thereof a cash payment for each share of
Common Stock surrendered pursuant to such Acquisition Event (the
"Acquisition Price"), provide that all outstanding Options shall
terminate upon consummation of such Acquisition Event and each
Participant shall receive, in exchange therefor, a cash payment equal
to the amount (if any) by which (A) the Acquisition Price multiplied by
the number of shares of Common Stock subject to such outstanding
Options (whether or not then exercisable), exceeds (B) the aggregate
exercise price of such Options; (iv) provide that all Restricted Stock
Awards then outstanding shall become free of all restrictions prior to
the consummation of the Acquisition Event; and (v) provide that any
other stock-based Awards outstanding (A) shall become exercisable,
realizable or vested in full, or shall be free of all conditions or
restrictions, as applicable to each such Award, prior to the
consummation of the Acquisition Event, or (B), if applicable, shall be
assumed, or equivalent Awards shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof).
An "Acquisition Event" shall mean: (a) any merger or
consolidation which results in the voting securities of the Company
outstanding immediately prior thereto representing immediately
thereafter (either by remaining outstanding or by being converted into
voting securities of the surviving or acquiring entity) less than 50%
of the combined voting power of the voting securities of the Company or
such surviving or acquiring entity outstanding immediately after such
merger or consolidation; (b) any sale of all or substantially all of
the assets of the Company; or (c) the complete liquidation of the
Company.
(2) ASSUMPTION OF OPTIONS UPON CERTAIN EVENTS. The
Board may grant Awards under the Plan in substitution for stock and
stock-based awards held by employees of another corporation who become
employees of the Company as a result of a merger or consolidation of
the employing corporation with the Company or the acquisition by the
Company of property or stock of the employing corporation. The
substitute Awards shall be granted on such terms and conditions as the
Board considers appropriate in the circumstances.
<PAGE> 6
(f) WITHHOLDING. Each Participant shall pay to the Company, or
make provision satisfactory to the Board for payment of, any taxes
required by law to be withheld in connection with Awards to such
Participant no later than the date of the event creating the tax
liability. The Board may allow Participants to satisfy such tax
obligations in whole or in part in shares of Common Stock, including
shares retained from the Award creating the tax obligation, valued at
their Fair Market Value. The Company may, to the extent permitted by
law, deduct any such tax obligations from any payment of any kind
otherwise due to a Participant.
(g) AMENDMENT OF AWARD. The Board may amend, modify or
terminate any outstanding Award, including but not limited to,
substituting therefor another Award of the same or a different type,
changing the date of exercise or realization, and converting an
Incentive Stock Option to a Nonstatutory Stock Option, provided that
the Participant's consent to such action shall be required unless the
Board determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.
(h) CONDITIONS ON DELIVERY OF STOCK. The Company will not be
obligated to deliver any shares of Common Stock pursuant to the Plan or
to remove restrictions from shares previously delivered under the Plan
until (i) all conditions of the Award have been met or removed to the
satisfaction of the Company, (ii) in the opinion of the Company's
counsel, all other legal matters in connection with the issuance and
delivery of such shares have been satisfied, including any applicable
securities laws and any applicable stock exchange or stock market rules
and regulations, and (iii) the Participant has executed and delivered
to the Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any applicable
laws, rules or regulations.
(i) ACCELERATION. The Board may at any time provide that any
Options shall become immediately exercisable in full or in part, that
any Restricted Stock Awards shall be free of all restrictions or that
any other stock-based Awards may become exercisable in full or in part
or free of some or all restrictions or conditions, or otherwise
realizable in full or in part, as the case may be.
9. MISCELLANEOUS
(a) NO RIGHT TO EMPLOYMENT OR OTHER STATUS. No person shall
have any claim or right to be granted an Award, and the grant of an
Award shall not be construed as giving a Participant the right to
continued employment or any other relationship with the Company. The
Company expressly reserves the right at any time to dismiss or
otherwise terminate its relationship with a Participant free from any
liability or claim under the Plan, except as expressly provided in the
applicable Award.
(b) NO RIGHTS AS STOCKHOLDER. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have
any rights as a stockholder with respect to any shares of Common Stock
to be distributed with respect to an Award until becoming the record
holder of such shares.
<PAGE> 7
(c) EFFECTIVE DATE AND TERM OF PLAN. The Plan shall become
effective on the date on which it is adopted by the Board, but no Award
granted to a Participant designated as subject to Section 162(m) by the
Board shall become exercisable, vested or realizable, as applicable to
such Award, unless and until the Plan has been approved by the
Company's stockholders. No Awards shall be granted under the Plan after
the completion of ten years from the earlier of (i) the date on which
the Plan was adopted by the Board or (ii) the date the Plan was
approved by the Company's stockholders, but Awards previously granted
may extend beyond that date.
(d) AMENDMENT OF PLAN. The Board may amend, suspend or
terminate the Plan or any portion thereof at any time, provided that no
Award granted to a Participant designated as subject to Section 162(m)
by the Board after the date of such amendment shall become exercisable,
realizable or vested, as applicable to such Award (to the extent that
such amendment to the Plan was required to grant such Award to a
particular Participant), unless and until such amendment shall have
been approved by the Company's stockholders.
(e) STOCKHOLDER APPROVAL. For purposes of this Plan,
stockholder approval shall mean approval by a vote of the stockholders
in accordance with the requirements of Section 162(m) of the Code.
(f) GOVERNING LAW. The provisions of the Plan and all Awards
made hereunder shall be governed by and interpreted in accordance with
the laws of the State of Delaware, without regard to any applicable
conflicts of law.
<PAGE> 1
EXHIBIT 5.1
Testa, Hurwitz & Thibeault, LLP
125 High Street
Boston, MA 02110
March 1, 2000
Concord Communications, Inc.
600 Nickerson Road
Marlboro, Massachusetts 01752
Re: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We are acting as counsel for Concord Communications, Inc., a Delaware
corporation (the "COMPANY"), in connection with the registration on a
Registration Statement on Form S-8 (the "REGISTRATION STATEMENT") under the
Securities Act of 1933, as amended, of the offer and sale of up to 265,962
shares of Common Stock, par value $.01 per share, of the Company (the "SHARES")
to be issued upon the exercise of options under the Mission Systems,
Incorporated 1996 Equity Incentive Stock Plan and the FirstSense Software, Inc.
1997 Stock Incentive Plan (collectively, the "PLANS").
We have examined, and are familiar with, and have relied as to factual
matters solely upon, copies of the Plans, the Restated Articles of Organization
and the Restated By-Laws of the Company, the minute books and stock records of
the Company and originals of such other documents, certificates and proceedings
as we have deemed necessary for the purpose of rendering this opinion.
Based upon and subject to the foregoing, we are of the opinion that the
Shares are duly authorized and, when issued and delivered pursuant to the terms
of the Plans and the terms of any agreement relating to any of the options
granted thereunder, will be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement.
Very truly yours,
/s/ Testa, Hurwitz & Thibeault, LLP
TESTA, HURWITZ & THIBEAULT, LLP
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated January 17, 2000,
included in Concord Communications, Inc.'s Form 8-K dated March 1, 2000 and to
all references to our Firm included in this Registration Statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Boston, Massachusetts
February 29, 2000
