<PAGE>
As filed with the Securities and Exchange Commission on July 17, 1998
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________
DOCUMENTUM, INC.
(Exact name of registrant as specified in its charter)
__________________
Delaware 95-4261421
(State of Incorporation) (I.R.S. Employer Identification No.)
___________________
5671 Gibraltar Drive
Pleasanton, California 94588-8547
(510) 463-6800
(Address and telephone number of principal executive offices)
___________________
Relevance Technologies, Inc.
1996 Stock Plan
(Full title of the plans)
____________________
Jeffrey A. Miller
President and Chief Executive Officer
Documentum, Inc.
5671 Gibraltar Drive
Pleasanton, California 94588-8547
(510) 463-6800
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
_____________________
Copies to:
Vincent P. Pangrazio, Esq.
Cooley Godward LLP
3000 Sand Hill Road
Building 3, Suite 230
Menlo Park, California 94025-7116
(650) 843-5000
_____________________
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
=====================================================================================================================
Proposed Maximum Proposed Maximum
Title of Securities to Amount to be Offering Price Per Aggregate Offering Amount of
Be Registered Registered Share (1) Price (1) Registration Fee
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Stock Options and
Common Stock (par
value $.001) 73,609 $1.1441 - $3.4323 $133,074 $40
=====================================================================================================================
</TABLE>
(1) Calculated solely for the purposes of this offering under Rule 457(h)
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
on the basis of the price at which the options may be exercised. The price per
share and aggregate offering price is based upon the weighted average exercise
price pursuant to Rule 457(h) of the Securities Act, of the options assumed.
Approximate date of commencement of proposed sale to the public: As soon
as practicable after this Registration Statement becomes effective.
The shares registered hereunder will be issued upon exercise of stock
options assumed by Documentum, Inc., a Delaware corporation (the "Registrant"),
pursuant to an Agreement and Plan of Merger and Reorganization among the
Registrant, RTI Acquisition Corp, a Delaware corporation and wholly owned
subsidiary of the Registrant, and Relevance Technologies, Inc., a California
corporation ("Relevance"), dated as of July 16, 1998. These options were
originally granted to employees of Relevance under Relevance's 1996 Stock Plan.
================================================================================
<PAGE>
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the Securities and Exchange
Commission (the "Commission") are incorporated by reference into this
Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the year ended December
31, 1997, including all material incorporated by reference therein;
(b) The Registrant's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998, including all material incorporated by reference therein;
(c) The Registrant's Current Report on Form 8-K, dated July 17, 1998.
All reports and other documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part of this Registration Statement from the date
of the filing of such reports and documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTIS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under Section 145 of the Delaware General Corporation Law, the Registrant has
broad powers to indemnify its directors and officers against liabilities they
may incur in such capacities, including liabilities under the Securities Act.
The Registrant's Certificate of Incorporation, as amended, provides for the
elimination of liability for monetary damages for breach of the directors'
fiduciary duty of care to the Registrant and its stockholders. These provisions
do not eliminate the directors' duty of care and, in appropriate circumstances,
equitable remedies such as injunctive or other forms of non-monetary relief will
remain available under Delaware law. In addition, each director will continue to
be subject to liability for breach of the director's duty of loyalty to the
Registrant, for acts or omissions not in good faith or involving intentional
misconduct, for knowing violations of law, for any transaction from which the
director derived an improper personal benefit, and for payment of dividends or
approval of stock repurchases or redemptions that are unlawful under Delaware
law. The provision does not affect a director's responsibilities under any other
laws, such as the federal securities laws or state or federal environmental
laws.
The Registrant has entered into agreements with its directors and executive
officers that require the Registrant to indemnify such persons against expenses,
judgments, fines, settlements and other amounts actually and reasonably incurred
(including expenses of a derivative action) in connection with any proceeding,
whether actual or threatened, to which any such person may be made a party by
reason of the fact that such person is or was a director or officer of the
Registrant or any of its affiliated enterprises, provided such person acted in
good faith and in a manner such person reasonably believed to be in or not
opposed to the best interests of the Registrant and, with respect to any
criminal proceeding, had no reasonable cause to believe his or her conduct was
unlawful. The indemnification agreements also set forth certain procedures that
will apply in the event of a claim for indemnification thereunder.
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit
Number Description
- ------- -----------
4.1/(2)/ Registrant's Amended and Restated Certificate of Incorporation.
4.2/(3)/ Certificate of Amendment to Registrant's Amended and Restated
Certificate of Incorporation.
4.3/(1)/ Registrant's Amended and Restated Bylaws.
4.4/(1)/ Specimen stock certificate.
4.5/(1)/ Amended and Restated Investor Rights Agreement, dated September 20,
1994, between the Registrant and certain investors.
4.6/(3)/ Registration Rights Agreement, dated July 16, 1998, between the
Registrant and certain stockholders.
5.1 Opinion of Cooley Godward LLP.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Cooley Godward LLP is contained in Exhibit 5.1 to this
Registration Statement.
24.1 Power of Attorney. Reference is made to the signature page.
99.1 Relevance Technologies, Inc. 1996 Stock Option Plan
_______________
(1) Filed as an exhibit to the Form S-1 Registration Statement (No. 33-80047),
as amended through the date hereof and incorporated herein by reference.
(2) Filed as an exhibit to the Form S-8 Registration Statement (No. 333-01832)
and incorporated herein by reference.
(3) Filed as an exhibit to the Form S-3 Registration Statement filed on July
17, 1998 (No. 333-59331) and incorporated herein by reference.
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;
(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 and of the
estimated maximum offering range may be reflected in the
<PAGE>
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 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 (a)(1)(i) and (a)(1)(ii) do not apply if 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 by the Registrant pursuant to Section 13 or 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
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post- effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
B. 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 Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new Registration Statement relating to the securities offered herein, 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 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Pleasanton, State of California, on July 16,
1998.
DOCUMENTUM, INC.
By /s/ Jeffrey A. Miller
---------------------------
Jeffrey A. Miller
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Jeffrey A. Miller and Mark S. Garrett,
and each or any one of them, his true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, or any of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
President, Chief Executive and Director
/s/ Jeffrey A. Miller (Principal Executive Officer) July 16, 1998
- --------------------------------------------------
Jeffrey A. Miller
Vice President, Finance and Operations,
and Chief Financial Officer (Principal
/s/ Mark S. Garrett Financial and Accounting Officer) July 16, 1998
- --------------------------------------------------
Mark S. Garrett
/s/ Robert V. Adams Chairman of the Board July 16, 1998
- --------------------------------------------------
Robert Adams
Director July 16, 1998
- --------------------------------------------------
Kathryn Gould
/s/ Colin O'Brien Director July 16, 1998
- --------------------------------------------------
Colin O'Brien
/s/ John L. Walecka Director July 16, 1998
- --------------------------------------------------
John L. Walecka
/s/ Edward Zander Director July 16, 1998
- --------------------------------------------------
Edward Zander
/s/ Geoffrey Moore Director July 16, 1998
- --------------------------------------------------
Geoffrey Moore
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
4.1/(2)/ Registrant's Amended and Restated Certificate of Incorporation.
4.2/(3)/ Certificate of Amendment to Registrant's Amended and Restated
Certificate of Incorporation.
4.3/(1)/ Registrant's Amended and Restated Bylaws.
4.4/(1)/ Specimen stock certificate.
4.5/(1)/ Amended and Restated Investor Rights Agreement, dated September 20,
1994, between the Registrant and certain investors.
4.6/(3)/ Registration Rights Agreement, dated July 16, 1998 between the
Registrant and certain stockholders.
5.1 Opinion of Cooley Godward LLP.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Cooley Godward LLP is contained in Exhibit 5.1 to this
Registration Statement.
24.1 Power of Attorney. Reference is made to the signature page.
99.1 Relevance Technologies, Inc. 1996 Stock Plan
_______________
(1) Filed as an exhibit to the Form S-1 Registration Statement (No. 33-80047),
as amended through the date hereof and incorporated herein by reference.
(2) Filed as an exhibit to the Form S-8 Registration Statement (No. 333-01832)
and incorporated herein by reference.
(3) Filed as an exhibit to the Form S-3 Registration Statement filed on July
17, 1998 (No. 333-59331) and incorporated herein by reference.
<PAGE>
Exhibit 5.1
July 17, 1998
Documentum, Inc.
5671 Gibraltar Drive
Pleasanton, CA 94588-8547
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection
with the filing by Documentum, Inc. (the "Company") of a Registration Statement
on Form S-8 (the "Registration Statement") with the Securities and Exchange
Commission covering the offering of up to 73,609 shares of the Company's Common
Stock, $.001 par value, (the "Shares") issuable pursuant to the Relevance
Technologies, Inc. 1996 Stock Plan, as amended (the "Plan") pursuant to stock
option agreements assumed in connection with the Company's acquisition of
Relevance Technologies, Inc. (the "Agreements).
In connection with this opinion, we have examined the Registration Statement,
the Agreements, your Certificate of Incorporation and Bylaws, as amended, and
such other documents, record, certificates, memoranda and other instruments as
we deem necessary as a basis for this opinion. We have assumed the genuineness
and authenticity of all documents submitted to us as originals, the conformity
to originals of all documents submitted to us as copies thereof, and the due
execution and delivery of all documents where due execution and delivery are a
prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the opinion
that the Shares, when sold and issued in accordance with the Plans, the
Registration Statement and related Prospectuses, will be validly issued, fully
paid, and nonassessable (except as to shares issued pursuant to certain deferred
payment arrangements, which will be fully paid and nonassessable when such
deferred payments are made in full).
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Yours very truly,
Cooley Godward LLP
By: /s/ Mark P. Tanoury
----------------------
Mark P. Tanoury
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 20, 1998, appearing on page
F-1 which is incorporated by reference in Documentum, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 1997.
/s/ PRICEWATERHOUSECOOPERS LLP
PRICEWATERHOUSECOOPERS LLP
San Jose, California
July 16, 1998
<PAGE>
Exhibit 99.1
RELEVANCE TECHNOLOGIES, INC.
1996 STOCK PLAN
ADOPTED ON DECEMBER 30, 1996
<PAGE>
TABLE OF CONTENTS
<TABLE>
Page No.
--------
<S> <C>
SECTION 1. ESTABLISHMENT AND PURPOSE....................................................1
SECTION 2. ADMINISTRATION...............................................................1
(a) Committees of the Board of Directors..............................................1
(b) Authority of the Board of Directors...............................................1
SECTION 3. ELIGIBILITY..................................................................1
(a) General Rule......................................................................1
(b) Ten-Percent Stockholders..........................................................1
SECTION 4. STOCK SUBJECT TO PLAN........................................................2
(a) Basic Limitation..................................................................2
(b) Additional Shares.................................................................2
SECTION 5. TERMS AND CONDITIONS OF AWARDS OR SALES......................................2
(a) Stock Purchase Agreement..........................................................2
(b) Duration of Offers and Nontransferability of Rights...............................2
(c) Purchase Price....................................................................2
(d) Withholding Taxes.................................................................3
(e) Restrictions on Transfer of Shares................................................3
(f) Accelerated Vesting...............................................................3
SECTION 6. TERMS AND CONDITIONS OF OPTIONS..............................................3
(a) Stock Option Agreement............................................................3
(b) Number of Shares..................................................................4
(c) Exercise Price....................................................................4
(d) Withholding Taxes.................................................................4
(e) Exercisability....................................................................4
(f) Accelerated Exercisability........................................................4
(g) Term..............................................................................5
(h) Nontransferability................................................................5
(i) Termination of Service (Except by Death)..........................................5
(j) Leaves of Absence.................................................................5
(k) Death of Optionee.................................................................6
(l) No Rights as a Stockholder........................................................6
(m) Modification, Extension and Assumption of Options.................................6
(n) Restrictions on Transfer of Shares and Minimum Vesting............................6
</TABLE>
i
<PAGE>
<TABLE>
<S> <C>
(o) Accelerated Vesting..............................................................6
SECTION 7. PAYMENT FOR SHARES...........................................................7
(a) General Rule......................................................................7
(b) Surrender of Stock................................................................7
(c) Services Rendered.................................................................7
(d) Promissory Note...................................................................7
(e) Exercise/Sale.....................................................................7
(f) Exercise/Pledge...................................................................7
SECTION 8. ADJUSTMENT OF SHARES.........................................................8
(a) General...........................................................................8
(b) Mergers and Consolidations........................................................8
(c) Reservation of Rights.............................................................8
SECTION 9. SECURITIES LAWS REQUIREMENTS.................................................8
(a) General...........................................................................8
(b) Financial Reports.................................................................9
SECTION 10. NO RETENTION RIGHTS.........................................................9
SECTION 11. DURATION AND AMENDMENTS.....................................................9
(a) Term of the Plan..................................................................9
(b) Right to Amend or Terminate the Plan..............................................9
(c) Effect of Amendment or Termination................................................9
SECTION 12. DEFINITIONS.................................................................9
SECTION 13. EXECUTION..................................................................12
</TABLE>
ii
<PAGE>
RELEVANCE TECHNOLOGIES, INC. 1996 STOCK PLAN
SECTION 1. ESTABLISHMENT AND PURPOSE.
The purpose of the Plan is to offer selected individuals an opportunity to
acquire a proprietary interest in the success of the Company, or to increase
such interest, by purchasing Shares of the Company's Stock. The Plan provides
both for the direct award or sale of Shares and for the grant of Options to
purchase Shares. Options granted under the Plan may include Nonstatutory Options
as well as Incentive Options intended to qualify under Section 422 of the Code.
Capitalized terms are defined in Section 12.
SECTION 2. ADMINISTRATION.
(a) Committees of the Board of Directors. The Plan may be administered by
one or more Committees. Each Committee shall consist of one or more members of
the Board of Directors who have been appointed by the Board of Directors. Each
Committee shall have such authority and be responsible for such functions as the
Board of Directors has assigned to it. If no Committee has been appointed, the
entire Board of Directors shall administer the Plan. Any reference to the Board
of Directors in the Plan shall be construed as a reference to the Committee (if
any) to whom the Board of Directors has assigned a particular function.
(b) Authority of the Board of Directors. Subject to the provisions of the
Plan, the Board of Directors shall have full authority and discretion to take
any actions it deems necessary or advisable for the administration of the Plan.
All decisions, interpretations and other actions of the Board of Directors shall
be final and binding on all Purchasers, all Optionees and all persons deriving
their rights from a Purchaser or Optionee.
SECTION 3. ELIGIBILITY.
(a) General Rule. Only Employees, Outside Directors and Consultants shall be
eligible for the grant of Options or the direct award or sale of Shares. Only
Employees shall be eligible for the grant of Incentive Options.
(b) Ten-Percent Stockholders. An individual who owns more than 10% of the
total combined voting power of all classes of outstanding stock of the Company,
its Parent or any of its Subsidiaries shall not be eligible for designation as
an Optionee or Purchaser unless (i) the Exercise Price is at least 110% of the
Fair Market Value of a Share on the date of grant, (ii) the Purchase Price (if
any) is at least 100% of the Fair Market Value of a Share and (iii) in the case
of an Incentive Option, such Incentive Option by its terms is not exercisable
after the expiration of five years from the date of grant. For purposes of this
Subsection (b), in determining stock ownership, the attribution rules of Section
424(d) of the Code shall be applied.
1
<PAGE>
SECTION 4. STOCK SUBJECT TO PLAN.
(a) Basic Limitation. Shares offered under the Plan may be authorized but
unissued Shares or treasury Shares. The aggregate number of Shares that may be
issued under the Plan (upon exercise of Options or other rights to acquire
Shares) shall not exceed 2,068,915 Shares/1/, subject to adjustment pursuant to
Section 8. The number of Shares that are subject to Options or other rights
outstanding at any time under the Plan shall not exceed the number of Shares
that then remain available for issuance under the Plan. The Company, during the
term of the Plan, shall at all times reserve and keep available sufficient
Shares to satisfy the requirements of the Plan.
(b) Additional Shares. In the event that any outstanding Option or other
right for any reason expires or is canceled or otherwise terminated, the Shares
allocable to the unexercised portion of such Option or other right shall again
be available for the purposes of the Plan. In the event that Shares issued under
the Plan are reacquired by the Company pursuant to any forfeiture provision,
right of repurchase or right of first refusal, such Shares shall again be
available for the purposes of the Plan, except that the aggregate number of
Shares which may be issued upon the exercise of Incentive Options shall in no
event exceed 2,068,915 Shares (subject to adjustment pursuant to Section 8).
SECTION 5. TERMS AND CONDITIONS OF AWARDS OR SALES.
(a) Stock Purchase Agreement. Each award or sale of Shares under the Plan
(other than upon exercise of an Option) shall be evidenced by a Stock Purchase
Agreement between the Purchaser and the Company. Such award or sale shall be
subject to all applicable terms and conditions of the Plan and may be subject to
any other terms and conditions which are not inconsistent with the Plan and
which the Board of Directors deems appropriate for inclusion in a Stock Purchase
Agreement. The provisions of the various Stock Purchase Agreements entered into
under the Plan need not be identical.
(b) Duration of Offers and Nontransferability of Rights. Any right to
acquire Shares under the Plan (other than an Option) shall automatically expire
if not exercised by the Purchaser within 30 days after the grant of such right
was communicated to the Purchaser by the Company. Such right shall not be
transferable and shall be exercisable only by the Purchaser to whom such right
was granted.
(c) Purchase Price. The Purchase Price of Shares to be offered under the
Plan shall not be less than 85% of the Fair Market Value of such Shares, and a
higher percentage may be required by Section 3(b). Subject to the preceding
sentence, the Purchase Price shall be determined by the Board of Directors at
its sole discretion. The Purchase Price shall be payable in a form described in
Section 7.
- ------------------------------
/1/ On January 29, 1997 the Board of Directors approved an increase of 1,618,915
shares to the original pool of 450,000 shares, for a total of 2,068,915.
2
<PAGE>
(d) Withholding Taxes. As a condition to the purchase of Shares, the
Purchaser shall make such arrangements as the Board of Directors may require for
the satisfaction of any federal, state, local or foreign withholding tax
obligations that may arise in connection with such purchase.
(e) Restrictions on Transfer of Shares and Minimum Vesting. Any Shares
awarded or sold under the Plan shall be subject to such special forfeiture
conditions, rights of repurchase, rights of first refusal and other transfer
restrictions as the Board of Directors may determine. Such restrictions shall be
set forth in the applicable Stock Purchase Agreement and shall apply in addition
to any restrictions that may apply to holders of Shares generally. Any right to
repurchase a Purchaser's Shares at the original Purchase Price (if any) upon
termination of the Purchaser's Service shall lapse at least as rapidly as the
following schedule:
Anniversary of Date Percentage of
of Sale or Award Shares Vested
------------------- -------------
First 20%
Second 40%
Third 60%
Fourth 80%
Fifth 100%
Any such repurchase right may be exercised only within 90 days after the
termination of the Purchaser's Service for cash or for cancellation of
indebtedness incurred in purchasing the Shares.
(f) Accelerated Vesting. Unless the applicable Stock Purchase Agreement
provides otherwise, any right to repurchase a Purchaser's Shares at the original
Purchase Price (if any) upon termination of the Purchaser's Service shall lapse
and all of such Shares shall become vested if (i) the Company is subject to a
Change in Control and (ii) the repurchase right is not assigned to the entity
that employs the Purchaser immediately after the Change in Control or to its
parent or subsidiary. Any of the Company's outstanding repurchase rights which
do not otherwise terminate at the time of the Change in Control shall
automatically terminate and all of the shares of Common Stock subject to those
terminated rights shall immediately vest in the event the Optionee's Service
should subsequently terminate by reason of an Involuntary Termination within
twelve (12) months following the effective date of such Change in Control
SECTION 6. TERMS AND CONDITIONS OF OPTIONS.
(a) Stock Option Agreement. Each grant of an Option under the Plan shall be
evidenced by a Stock Option Agreement between the Optionee and the Company. Such
Option shall be subject to all applicable terms and conditions of the Plan and
may be subject to any other terms and conditions which are not inconsistent with
the Plan and which the Board of Directors deems appropriate for inclusion in a
Stock Option Agreement. The provisions of the various Stock Option Agreements
entered into under the Plan need not be identical.
3
<PAGE>
(b) Number of Shares. Each Stock Option Agreement shall specify the number
of Shares that are subject to the Option and shall provide for the adjustment of
such number in accordance with Section 8. The Stock Option Agreement shall also
specify whether the Option is an Incentive Option or a Nonstatutory Option.
(c) Exercise Price. Each Stock Option Agreement shall specify the Exercise
Price. The Exercise Price of an Incentive Option shall not be less than 100% of
the Fair Market Value of a Share on the date of grant, and a higher percentage
may be required by Section 3(b). The Exercise Price of a Nonstatutory Option
shall not be less than 85% of the Fair Market Value of a Share on the date of
grant, and a higher percentage may be required by Section 3(b). Subject to the
preceding two sentences, the Exercise Price under any Option shall be determined
by the Board of Directors at its sole discretion. The Exercise Price shall be
payable in a form described in Section 7.
(d) Withholding Taxes. As a condition to the exercise of an Option, the
Optionee shall make such arrangements as the Board of Directors may require for
the satisfaction of any federal, state, local or foreign withholding tax
obligations that may arise in connection with such exercise. The Optionee shall
also make such arrangements as the Board of Directors may require for the
satisfaction of any federal, state, local or foreign withholding tax obligations
that may arise in connection with the disposition of Shares acquired by
exercising an Option.
(e) Exercisability. Each Stock Option Agreement shall specify the date when
all or any installment of the Option is to become exercisable. An Option shall
become exercisable at least as rapidly as set forth in the following schedule:
Anniversary of Percentage of Shares
Date of Option Grant Exercisable
-------------------- -----------
First 20%
Second 40%
Third 60%
Fourth 80%
Fifth 100%
Subject to the preceding sentence, the exercisability provisions of any Stock
Option Agreement shall be determined by the Board of Directors at its sole
discretion.
(f) Accelerated Exercisability. Unless the applicable Stock Option Agreement
provides otherwise, all of an Optionee's Options shall become exercisable in
full if (i) the Company is subject to a Change in Control, (ii) such Options do
not remain outstanding, (iii) such Options are not assumed by the surviving
corporation or its parent and (iv) the surviving corporation or its parent does
not substitute options with substantially the same terms for such Options. Any
options which are assumed or replaced in the Change in Control and do not
otherwise accelerate at that time shall automatically accelerate in full in the
event the Optionee's
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Service should subsequently terminate by reason of an Involuntary Termination
within twelve (12) months following the effective date of such Change in
Control.
(g) Basic Term. The Stock Option Agreement shall specify the term of the
Option. The term shall not exceed 10 years from the date of grant, and a shorter
term may be required by Section 3(b). Subject to the preceding sentence, the
Board of Directors at its sole discretion shall determine when an Option is to
expire.
(h) Nontransferability. No Option shall be transferable by the Optionee
other than by beneficiary designation, will or the laws of descent and
distribution. An Option may be exercised during the lifetime of the Optionee
only by the Optionee or by the Optionee's guardian or legal representative. No
Option or interest therein may be transferred, assigned, pledged or hypothecated
by the Optionee during the Optionee's lifetime, whether by operation of law or
otherwise, or be made subject to execution, attachment or similar process.
(i) Termination of Service (Except by Death). If an Optionee's Service
terminates for any reason other than the Optionee's death, then the Optionee's
Options shall expire on the earliest of the following occasions:
(i) The expiration date determined pursuant to Subsection (g) above;
(ii) The date three months after the termination of the Optionee's
Service for any reason other than Disability; or
(iii) The date six months after the termination of the Optionee's
Service by reason of Disability.
The Optionee may exercise all or part of the Optionee's Options at any time
before the expiration of such Options under the preceding sentence, but only to
the extent that such Options had become exercisable before the Optionee's
Service terminated (or became exercisable as a result of the termination) and
the underlying Shares had vested before the Optionee's Service terminated (or
vested as a result of the termination). The balance of such Options shall lapse
when the Optionee's Service terminates. In the event that the Optionee dies
after the termination of the Optionee's Service but before the expiration of the
Optionee's Options, all or part of such Options may be exercised (prior to
expiration) by the executors or administrators of the Optionee's estate or by
any person who has acquired such Options directly from the Optionee by
beneficiary designation, bequest or inheritance, but only to the extent that
such Options had become exercisable before the Optionee's Service terminated (or
became exercisable as a result of the termination) and the underlying Shares had
vested before the Optionee's Service terminated (or vested as a result of the
termination).
(j) Leaves of Absence. For purposes of Subsection (i) above, Service shall
be deemed to continue while the Optionee is on a bona fide leave of absence, if
such leave was approved by the Company in writing and if continued crediting of
Service for this purpose is expressly required by the terms of such leave or by
applicable law (as determined by the Company).
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(k) Death of Optionee. If an Optionee dies while the Optionee is in Service,
then the Optionee's Options shall expire on the earlier of the following dates:
(i) The expiration date determined pursuant to Subsection (g) above;
or
(ii) The date 12 months after the Optionee's death.
All or part of the Optionee's Options may be exercised at any time before the
expiration of such Options under the preceding sentence by the executors or
administrators of the Optionee's estate or by any person who has acquired such
Options directly from the Optionee by beneficiary designation, bequest or
inheritance, but only to the extent that such Options had become exercisable
before the Optionee's death or became exercisable as a result of the death. The
balance of such Options shall lapse when the Optionee dies.
(l) No Rights as a Stockholder. An Optionee, or a transferee of an Optionee,
shall have no rights as a stockholder with respect to any Shares covered by the
Optionee's Option until such person becomes entitled to receive such Shares by
filing a notice of exercise and paying the Exercise Price pursuant to the terms
of such Option.
(m) Modification, Extension and Assumption of Options. Within the
limitations of the Plan, the Board of Directors may modify, extend or assume
outstanding Options or may accept the cancellation of outstanding Options
(whether granted by the Company or another issuer) in return for the grant of
new Options for the same or a different number of Shares and at the same or a
different Exercise Price. The foregoing notwithstanding, no modification of an
Option shall, without the consent of the Optionee, impair the Optionee's rights
or increase the Optionee's obligations under such Option.
(n) Restrictions on Transfer of Shares and Minimum Vesting. Any Shares
issued upon exercise of an Option shall be subject to such special forfeiture
conditions, rights of repurchase, rights of first refusal and other transfer
restrictions as the Board of Directors may determine. Such restrictions shall be
set forth in the applicable Stock Option Agreement and shall apply in addition
to any restrictions that may apply to holders of Shares generally. Any right to
repurchase an Optionee's Shares at the original Exercise Price upon termination
of the Optionee's Service shall lapse at least as rapidly as the schedule set
forth in Subsection (e) above. Any such repurchase right may be exercised only
within 90 days after the termination of the Optionee's Service for cash or for
cancellation of indebtedness incurred in purchasing the Shares.
(o) Accelerated Vesting. Unless the applicable Stock Option Agreement
provides otherwise, any right to repurchase an Optionee's Shares at the original
Exercise Price upon termination of the Optionee's Service shall lapse and all of
such Shares shall become vested if (i) the Company is subject to a Change in
Control and (ii) the repurchase right is not assigned to the entity that employs
the Optionee immediately after the Change in Control or to its parent or
subsidiary.
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SECTION 7. PAYMENT FOR SHARES.
(a) General Rule. The entire Purchase Price or Exercise Price of Shares
issued under the Plan shall be payable in cash or cash equivalents at the time
when such Shares are purchased, except as otherwise provided in this Section 7.
(b) Surrender of Stock. To the extent that a Stock Option Agreement so
provides, payment may be made all or in part with Shares owned by the Optionee
or the Optionee's representative. Such Shares shall be surrendered to the
Company in good form for transfer and shall be valued at their Fair Market Value
on the date when the Option is exercised. This Subsection (b) shall not apply to
the extent that acceptance of Shares in payment of the Exercise Price would
cause the Company to recognize compensation expense with respect to the Option
for financial reporting purposes.
(c) Services Rendered. At the discretion of the Board of Directors, Shares
may be awarded under the Plan in consideration of services rendered to the
Company, a Parent or a Subsidiary prior to the award.
(d) Promissory Note. To the extent that a Stock Option Agreement or Stock
Purchase Agreement so provides, all or a portion of the Exercise Price or
Purchase Price (as the case may be) of Shares issued under the Plan may be paid
with a full-recourse promissory note. The par value of the Shares, if newly
issued, shall be paid in cash or cash equivalents. The Shares shall be pledged
as security for payment of the principal amount of the promissory note and
interest thereon. The interest rate payable under the terms of the promissory
note shall not be less than the minimum rate (if any) required to avoid the
imputation of additional interest under the Code. Subject to the foregoing, the
Board of Directors (at its sole discretion) shall specify the term, interest
rate, amortization requirements (if any) and other provisions of such note.
(e) Exercise/Sale. To the extent that a Stock Option Agreement so provides,
and if Stock is publicly traded, payment may be made all or in part by the
delivery (on a form prescribed by the Company) of an irrevocable direction to a
securities broker approved by the Company to sell Shares and to deliver all or
part of the sales proceeds to the Company in payment of all or part of the
Exercise Price and any withholding taxes.
(f) Exercise/Pledge. To the extent that a Stock Option Agreement so
provides, and if Stock is publicly traded, payment may be made all or in part by
the delivery (on a form prescribed by the Company) of an irrevocable direction
to pledge Shares to a securities broker or lender approved by the Company, as
security for a loan, and to deliver all or part of the loan proceeds to the
Company in payment of all or part of the Exercise Price and any withholding
taxes.
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SECTION 8. ADJUSTMENT OF SHARES.
(a) General. In the event of a subdivision of the outstanding Stock, a
declaration of a dividend payable in Shares, a declaration of an extraordinary
dividend payable in a form other than Shares in an amount that has a material
effect on the Fair Market Value of the Stock, a combination or consolidation of
the outstanding Stock into a lesser number of Shares, a recapitalization, a
spin-off, a reclassification or a similar occurrence, the Board of Directors
shall make appropriate adjustments in one or more of (i) the number of Shares
available for future grants under Section 4, (ii) the number of Shares covered
by each outstanding Option or (iii) the Exercise Price under each outstanding
Option.
(b) Mergers and Consolidations. In the event that the Company is a party to
a merger or consolidation, outstanding Options shall be subject to the agreement
of merger or consolidation. Such agreement, without the Optionees' consent, may
provide for:
(i) The continuation of such outstanding Options by the Company (if
the Company is the surviving corporation);
(ii) The assumption of the Plan and such outstanding Options by the
surviving corporation or its parent;
(iii) The substitution by the surviving corporation or its parent of
options with substantially the same terms for such outstanding Options; or
(iv) The cancellation of such outstanding Options without payment of
any consideration.
(c) Reservation of Rights. Except as provided in this Section 8, an Optionee
or Purchaser shall have no rights by reason of (i) any subdivision or
consolidation of shares of stock of any class, (ii) the payment of any dividend
or (iii) any other increase or decrease in the number of shares of stock of any
class. Any issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number or
Exercise Price of Shares subject to an Option. The grant of an Option pursuant
to the Plan shall not affect in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or changes of its capital
or business structure, to merge or consolidate or to dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 9. SECURITIES LAW REQUIREMENTS.
(a) General. Shares shall not be issued under the Plan unless the issuance
and delivery of such Shares comply with (or are exempt from) all applicable
requirements of law, including (without limitation) the Securities Act of 1933,
as amended, the rules and regulations promulgated thereunder, state securities
laws and regulations, and the regulations of any stock exchange or other
securities market on which the Company's securities may then be traded.
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(b) Financial Reports. The Company each year shall furnish to Optionees,
Purchasers and stockholders who have received Stock under the Plan its balance
sheet and income statement, unless such Optionees, Purchasers or stockholders
are key Employees whose duties with the Company assure them access to equivalent
information. Such balance sheet and income statement need not be audited.
SECTION 10. NO RETENTION RIGHTS.
Nothing in the Plan or in any right or Option granted under the Plan shall
confer upon the Purchaser or Optionee any right to continue in Service for any
period of specific duration or interfere with or otherwise restrict in any way
the rights of the Company (or any Parent or Subsidiary employing or retaining
the Purchaser or Optionee) or of the Purchaser or Optionee, which rights are
hereby expressly reserved by each, to terminate his or her Service at any time
and for any reason, with or without cause.
SECTION 11. DURATION AND AMENDMENTS.
(a) Term of the Plan. The Plan, as set forth herein, shall become effective
on the date of its adoption by the Board of Directors, subject to the approval
of the Company's stockholders. In the event that the stockholders fail to
approve the Plan within 12 months after its adoption by the Board of Directors,
any grants of Options or sales or awards of Shares that have already occurred
shall be rescinded, and no additional grants, sales or awards shall be made
thereafter under the Plan. The Plan shall terminate automatically 10 years after
its adoption by the Board of Directors and may be terminated on any earlier date
pursuant to Subsection (b) below.
(b) Right to Amend or Terminate the Plan. The Board of Directors may amend,
suspend or terminate the Plan at any time and for any reason; provided, however,
that any amendment of the Plan which increases the number of Shares available
for issuance under the Plan (except as provided in Section 8), or which
materially changes the class of persons who are eligible for the grant of
Incentive Options, shall be subject to the approval of the Company's
stockholders. Stockholder approval shall not be required for any other amendment
of the Plan.
(c) Effect of Amendment or Termination. No Shares shall be issued or sold
under the Plan after the termination thereof, except upon exercise of an Option
granted prior to such termination. The termination of the Plan, or any amendment
thereof, shall not affect any Share previously issued or any Option previously
granted under the Plan.
SECTION 12. DEFINITIONS.
(a) "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time.
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(b) "Change in Control" shall mean:
(i) The consummation of a merger or consolidation of the Company with
or into another entity or any other corporate reorganization, if more than
50% of the combined voting power of the continuing or surviving entity's
securities outstanding immediately after such merger, consolidation or other
reorganization is owned by persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization; or
(ii) The sale, transfer or other disposition of all or substantially
all of the Company's assets.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(d) "Committee" shall mean a committee of the Board of Directors, as
described in Section 2(a).
(e) "Company" shall mean Relevance Technologies, Inc., a Delaware
corporation.
(f) "Consultant" shall mean an individual who performs bona fide services
for the Company, a Parent or a Subsidiary as a consultant or advisor, excluding
Employees and Outside Directors.
(g) "Disability" shall mean that the Optionee is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment.
(h) "Employee" shall mean any individual who is a common-law employee of the
Company, a Parent or a Subsidiary.
(i) "Exercise Price" shall mean the amount for which one Share may be
purchased upon exercise of an Option, as specified by the Board of Directors in
the applicable Stock Option Agreement.
(j) "Fair Market Value" shall mean the fair market value of a Share, as
determined by the Board of Directors in good faith. Such determination shall be
conclusive and binding on all persons.
(k) "Incentive Option" shall mean an employee incentive stock option
described in Section 422(b) of the Code.
(l) Involuntary Termination shall mean the termination of the Service of any
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individual which occurs by reason of:
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(i) such individual's involuntary dismissal or discharge by the
Corporation for reasons other than Misconduct, or
(ii) such individual's voluntary resignation following (A) a change in
his or her position with the Corporation which materially reduces his or her
level of responsibility, (B) a reduction in his or her level of compensation
(including base salary, fringe benefits and participation in corporate-
performance based bonus or incentive programs) by more than fifteen percent
(15%) or (C) a relocation of such individual's place of employment by more
than fifty (50) miles, provided and only if such change, reduction or
relocation is effected by the Corporation without the individual's consent.
(m) Misconduct shall mean the commission of any act of fraud, embezzlement
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or dishonesty by the Optionee, any unauthorized use or disclosure by such person
of confidential information or trade secrets of the Corporation (or any Parent
or Subsidiary), or any other intentional misconduct by such person adversely
affecting the business or affairs of the Corporation (or any Parent or
Subsidiary) in a material manner. The foregoing definition shall not be deemed
to be inclusive of all the acts or omissions which the Corporation (or any
Parent or Subsidiary) may consider as grounds for the dismissal or discharge of
any Optionee or other person in the Service of the Corporation (or any Parent or
Subsidiary).
(n) "Nonstatutory Option" shall mean a stock option not described in
Sections 422(b) or 423(b) of the Code.
(o) "Option" shall mean an Incentive Option or Nonstatutory Option granted
under the Plan and entitling the holder to purchase Shares.
(p) "Optionee" shall mean an individual who holds an Option.
(q) "Outside Director" shall mean a member of the Board of Directors who is
not an Employee.
(r) "Parent" shall mean any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.
(s) "Plan" shall mean this Relevance Technologies, Inc. 1996 Stock Plan.
(t) "Purchase Price" shall mean the consideration for which one Share may be
acquired under the Plan (other than upon exercise of an Option), as specified by
the Board of Directors.
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(u) "Purchaser" shall mean an individual to whom the Board of Directors has
offered the right to acquire Shares under the Plan (other than upon exercise of
an Option).
(v) "Service" shall mean service as an Employee, Outside Director or
Consultant.
(w) "Share" shall mean one share of Stock, as adjusted in accordance with
Section 8 (if applicable).
(x) "Stock" shall mean the Common Stock of the Company, with a par value of
$0.001 per Share.
(y) "Stock Option Agreement" shall mean the agreement between the Company
and an Optionee which contains the terms, conditions and restrictions pertaining
to the Optionee's Option.
(z) "Stock Purchase Agreement" shall mean the agreement between the Company
and a Purchaser who acquires Shares under the Plan which contains the terms,
conditions and restrictions pertaining to the acquisition of such Shares.
(aa) "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain. A corporation that attains
the status of a Subsidiary on a date after the adoption of the Plan shall be
considered a Subsidiary commencing as of such date.
SECTION 13. EXECUTION.
To record the adoption of the Plan by the Board of Directors, the
Company has caused its authorized officer to execute the same.
RELEVANCE TECHNOLOGIES, INC.
By:
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Title:
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