<PAGE> 1
As filed with the Securities and Exchange Commission on August 27, 1997
Registration No. 333-
----------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BAAN COMPANY N.V.
(Exact name of registrant as specified in its charter)
The Netherlands Not Applicable
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
BAAN COMPANY N.V.
Baron van Nagellstraat 89
3371 LK Barneveld
P.O.Box 143
3770 AC Barneveld
The Netherlands
011-31-342-428888
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
AURUM SOFTWARE, INC. AMENDED 1995 STOCK PLAN
AURUM'S 1996 DIRECTOR OPTION PLAN
(Full title of the plans)
Wim H. Heijting, Esq.
Baan Company N.V.
c/o Baan USA, Inc.
4600 Bohannon Drive
Menlo Park, California 94025
(415) 462-4949
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
HOWARD S. ZEPRUN, ESQ.
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
650 Page Mill Road
Palo Alto, California 94304-1050
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of Securities to be Price Offering Registration
to be Registered Registered Per Share(1) Price(2) Fee(3)
------------------- ---------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
Common Stock, NLG 0.01 par value
- -Outstanding under Aurum's Amended 1995 Stock 522,643(4) $5.1301 $2,681,210.854 $812.49
Plan
- -Outstanding under Aurum's 1996 Director -0- -0- -0- -0-
Option Plan
Total 522,643(4) $5.1301 $2,681,210.854 $812.49
</TABLE>
(1) Computed in accordance with Rule 457(h) under the Securities Act of
1933, as amended, solely for the purpose of calculating the
registration fee. Computation based on the weighted average per share
exercise price (rounded to the nearest 1/10th of one cent) of
outstanding options under the referenced plan, the shares issuable
under which are registered hereby.
(2) The proposed maximum aggregate offering price is computed by
multiplying the Proposed Maximum Offering Price Per Share by the Amount
to be Registered.
(3) Amount of Registration Fee was calculated pursuant to Section 6(b) of
the Securities Act of 1933, which states that the fee shall be "one
thirty-third of one per centum of the maximum aggregate price at which
such securities are proposed to be offered."
(4) Converted to Baan shares based on an Exchange Ratio of 0.355932203.
<PAGE> 3
BAAN COMPANY N.V.
REGISTRATION STATEMENT ON FORM S-8
PART I: INFORMATION REQUIRED IN THE PROSPECTUS
ITEM 1. PLAN INFORMATION
Omitted pursuant to the instructions and provisions of Form S-8.
ITEM 2. REGISTRATION INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
Omitted pursuant to the instructions and provisions of Form S-8.
PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This Registration Statement relates to 522,643 shares of Common Stock par value
NLG 0.01 per share (the "COMMON STOCK"), of Baan Company N.V., a Netherlands
corporation (the "REGISTRANT"), being registered for use under the Registrant's
Aurum Software, Inc. Amended 1995 Stock Plan and Aurum Software, Inc. 1996
Director Option Plan (the "PLANS").
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
There are hereby incorporated by reference into this Registration
Statement the following documents and information heretofore filed with the
Securities and Exchange Commission (the "Commission") by the Registrant:
1. The Registrant's Registration Statement on Form 20-F dated
April 29, 1997 pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT").
2. All other reports filed by the Company pursuant to
Section 13(a) or 15(d) of the Exchange Act since the end
of the fiscal year covered by the Annual Report on Form
20-F referred in (1) above.
3. Description of Registrant's Common Stock contained in
the Registration Statement on Form 20-F dated May 12,
1995, and any registration statements filed after such
date under Section 12 of the Exchange Act, and amendments
and reports filed for the purpose of updating such
description.
4. To the extent designated therein certain Reports on
Form 6-K and all other documents subsequently filed by the
Registrant pursuant to Sections 13(a), 13(c) and 15(d) of
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 that remain
unsold, shall be deemed be incorporated by reference and
be part hereof from the date of such document.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
II-1
<PAGE> 4
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the issuance of shares of Common Stock offered
hereby will be passed upon for the Registrant by De Brauw Blackstone Westbroek
of the Netherlands.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The concept of indemnification of directors and officers of a
company for liabilities arising from their actions as members of the management
or supervisory boards is, in principle, accepted in The Netherlands and
sometimes is provided for in a company's articles of association. Although,
neither the laws of The Netherlands nor the Registrant's Articles of Association
contain any provisions in this respect, the Registrant has entered into
indemnification agreements with its directors and officers, providing for
indemnification by the Registrant against any liability to which a director or
executive officer may be subject for judgments, settlements, penalties, fines
and expenses of defense (including attorneys' fees, bonds and costs of
investigation), arising out of or in any way related to acts or omissions as a
director, officer or in any other capacity in which services are rendered to the
Registrant or its subsidiaries. The agreements provide that a director or
officer is not entitled to indemnification under such agreements (i) if
indemnification is expressly prohibited under applicable law, (ii) for certain
violations of securities laws or (iii) for certain claims initiated by the
officer or director. Generally, under Netherlands law a director will not be
held personally liable for decisions made with reasonable business judgment,
absent self dealing. In addition, indemnification may not be available to
directors or officers under Netherlands law if any act or omission by a director
or officer would qualify as willful misconduct or gross negligence.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. INDEX TO EXHIBITS.
<TABLE>
<CAPTION>
Exhibit
Number Description of Document
------- -----------------------
<S> <C>
3.1 English translation of Articles of Association of the Company
lodged with the Chamber of Commerce and Industry for Arnhem, The
Netherlands*
3.2 Articles of Association, as amended on May 29, 1996 (See Exhibit
3.1)
4.1 Aurum Software, Inc. Amended 1995 Stock Plan
4.2 Aurum Software, Inc. 1996 Director Option Plan
5.1 Opinion and Consent of De Brauw Blackstone Westbroek
23.1 Consent of Moret Ernst & Young Accountants, Independent Auditors.
23.2 Consent of De Brauw Blackstone Westbroek (included in Exhibit
5.1)
24.1 Power of Attorney (see page II-4)
</TABLE>
- -----------------
* Incorporated by reference to the Registration Statement (Registration
Statement No. 333-24201) on Form F-3 filed on March 31, 1997.
II-2
<PAGE> 5
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 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) 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 Exchange Act (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the Registrant's Articles of Association,
Bylaws, indemnification agreements 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 Securities Act of 1933 and will be governed by the
final adjudication of such issue.
II-3
<PAGE> 6
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Jan Baan, Tom C. Tinsley,
Amal M. Johnson, Jan Westerhoud and Willem Heijting, jointly and severally, his
or her attorneys-in-fact, each with the power of substitution, for him in any
and all capacities, to sign any amendments to this Registration Statement on
Form S-8 and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming all that each of said attorney-in-fact, or his or her
substitute or substitutes, may 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.
Signatures Title Date
- ---------- ----- ----
- -------------------
Jan Baan Managing Director, Chairman of the August 27, 1997
Board, Chief Executive Officer
(Principal Executive Officer)
- -------------------
J.G. Paul Baan Chairman of the Supervisory Board August 27, 1997
/S/ TOM C. TINSLEY
- -------------------
Tom C. Tinsley Managing Director, President August 27, 1997
and Chief Operating Officer
/S/ AMAL M. JOHNSON
- -------------------
Amal M. Johnson Managing Director, Executive August 27, 1997
Vice President, Baan Affiliates
and Marketing
/S/JAN WESTERHOUD
- -------------------
Jan Westerhoud Chief Financial Officer August 27, 1997
/S/WILLIAM O. GRABE
- -------------------
William O. Grabe Supervisory Director August 27, 1997
/S/DAVID C. HODGSON
- -------------------
David C. Hodgson Supervisory Director August 27, 1997
/S/GRAHAM J. SHARMAN
- -------------------
Graham J. Sharman Supervisory Director August 27, 1997
- -------------------
J.C.(Hans) Wortmann Supervisory Director August 27, 1997
II-4
<PAGE> 7
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE
REGISTRANT HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS
BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF CUPERTINO,
STATE OF CALIFORNIA, ON THE 27TH DAY OF AUGUST, 1997.
BAAN COMPANY N.V.
By: /S/ AMAL M. JOHNSON
--------------------------------------------
Amal M. Johnson, Managing Director, Executive
Vice President, Baan Affiliates and Marketing
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.
Signatures Title Date
- ---------- ----- ----
- -------------------
Jan Baan Managing Director, Chairman of the August 27, 1997
Board, Chief Executive Officer
(Principal Executive Officer)
- -------------------
J.G. Paul Baan Chairman of the Supervisory Board August 27, 1997
/S/ TOM C. TINSLEY
- -------------------
Tom C. Tinsley Managing Director, President August 27, 1997
and Chief Operating Officer
/S/ AMAL M. JOHNSON
- -------------------
Amal M. Johnson Managing Director, Executive August 27, 1997
Vice President, Baan Affiliates
and Marketing
/S/JAN WESTERHOUD
- -------------------
Jan Westerhoud Chief Financial Officer August 27, 1997
/S/WILLIAM O. GRABE
- -------------------
William O. Grabe Supervisory Director August 27, 1997
/S/DAVID C. HODGSON
- -------------------
David C. Hodgson Supervisory Director August 27, 1997
/S/GRAHAM J. SHARMAN
- -------------------
Graham J. Sharman Supervisory Director August 27, 1997
- -------------------
J.C.(Hans) Wortmann Supervisory Director August 27, 1997
*By:
---------------------
ATTORNEY-IN-FACT
II-5
<PAGE> 8
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description of Document
- ------- -----------------------
<S> <C>
3.1 English translation of Articles of Association of the Company
lodged with the Chamber of Commerce and Industry for Arnhem, The
Netherlands*
3.2 Articles of Association, as amended on May 29, 1996 (See Exhibit
3.1)
4.1 Aurum Software, Inc. Amended 1995 Stock Plan
4.2 Aurum Software, Inc. 1996 Director Option Plan
5.1 Opinion and Consent of De Brauw Blackstone Westbroek
23.1 Consent of Moret Ernst & Young Accountants, Independent Auditors.
23.2 Consent of De Brauw Blackstone Westbroek (included in Exhibit
5.1)
24.1 Power of Attorney (see page II-4)
</TABLE>
- -----------------
* Incorporated by reference to the Registration Statement (Registration
Statement No. 333-24201) on Form F-3 filed on March 31, 1997.
<PAGE> 1
EXHIBIT 4.1
AURUM SOFTWARE, INC.
AMENDED 1995 STOCK PLAN
(as amended September 11, 1996)
1. Purposes of the Plan. The purposes of this Stock Plan are to attract and
retain the best available personnel for positions of substantial responsibility,
to provide additional incentive to Employees and Consultants of the Company and
its Subsidiaries, and to promote the success of the Company's business. Options
granted under the Plan may be Incentive Stock Options or Nonstatutory Stock
Options, as determined by the Administrator at the time of grant of an Option
and subject to the applicable provisions of Section 422 of the Code and the
regulations promulgated thereunder. Stock Purchase Rights may also be granted
under the Plan.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or any of its Committees appointed
pursuant
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means a Committee appointed by the Board of Directors in
accordance with Section 4 of the Plan.
(e) "Common Stock" means the Common Stock of the Company.
(f) "Company" means Aurum Software, Inc., a California corporation.
(g) "Consultant" means any person who is engaged by the Company or any
Parent or Subsidiary to render consulting or advisory services and is
compensated for such services and any Director of the Company, whether
compensated for such services or not.
(h) "Continuous Status as an Employee or Consultant" means that the
employment or consulting relationship with the Company or any Parent or
Subsidiary is not interrupted or terminated. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor. A
leave of absence approved by the Company shall include sick leave, military
leave, or any other personal leave approved by an authorized representative of
the Company. For purposes of Incentive Stock Options, no such leave may exceed
90 days unless reemployment upon expiration of such leave is guaranteed by
statute or contract, including Company policies. If reemployment upon expiration
of a leave of absence approved by the Company is not so guaranteed, on the 91st
day of such leave, any Incentive Stock Option held by the Optionee shall cease
to be treated as an Incentive Stock Option and shall be treated for tax purposes
as a Nonstatutory Stock Option.
(i) "Director" means a member of the Board of Directors of the Company.
1
<PAGE> 2
(j) "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a Director's fee by the Company shall not be sufficient to constitute
"employment" by the Company.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(l) "Fair Market Value" means, as of any date, the value of Common Stock,
determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the National
Market of the Nasdaq Stock Market, its Fair Market Value shall be the closing
sales price for such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or system for the last market trading day prior to the
time of determination and reported in The Wall Street Journal or such other
source as the Administrator deems reliable;
(ii) If the Common Stock is quoted on the Nasdaq Stock Market Out
not on the National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high bid and low asked prices for the Common Stock
on the last market trading day prior to the day of determination; or
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Administrator.
(m) "Incentive Stock Option" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code.
(n) "Nonstatutory Stock Option" means an Option not intended to qualify
as an Incentive Stock Option.
(o) "Officer" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
(p) "Option" means a stock option granted pursuant to the Plan.
(q) "Optioned Stock" means the Common Stock subject to an Option or a
Stock Purchase Right.
(r) "Optionee" means an Employee or Consultant who receives an Option or
Stock Purchase Right.
(s) "Parent". means a "parent corporation," whether now or hereafter
existing as defined in Section 424(e) of the Code.
(t) "Plan" means this 1995 Stock Plan.
(u) "Restricted Stock" means shares of Common Stock acquired pursuant to
a grant of a Stock Purchase Right under Section 11 below. (v) "Share" means a
share of the Common Stock, as adjusted in accordance with Section 12 below.
2
<PAGE> 3
(v) "Share" means a share of the Common Stock, as adjusted in accordance
with Section 12 below.
(w) "Stock Purchase Right" means a right to purchase Common Stock
pursuant to Section 11 below.
(x) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 12 of the
Plan, the maximum aggregate number of Shares which may be subject to option and
sold under the Plan is 4,319,695 Shares* (after adjustment for the one-for-four
reverse split of the Common Stock effected in September 1996). The Shares may be
authorized but unissued or reacquired Common Stock.
If an Option or Stock Purchase Right expires or becomes without having
been exercised in full or is surrendered pursuant to an Option Exchange Program,
the unpurchased Shares that were subject thereto shall become available for
future grant or sale under the Plan (unless the Plan has terminated). However,
Shares that have actually been issued under the Plan, upon exercise of either an
Option or Stock Purchase Right, shall not be returned to the Plan and shall not
become available for future distribution under the Plan, except that if Shares
of Restricted Stock are repurchased by the Company at their original purchase
price, and the original purchaser of such Shares did not receive any benefits of
ownership of such Shares, such Shares shall become available for future grant
under the Plan. For purposes of the preceding sentence, voting rights shall not
be considered a benefit of Share ownership.
4. Administration of the Plan.
(a) Initial Plan Procedure. Prior to the date, if any, upon which the
Company becomes subject to the Exchange Act, the Plan shall be administered by
the Board or a Committee appointed by the Board.
* Reflects all shares reserved under the Plan since its adoption.
(b) Plan Procedure After the Date, if any, upon which the Company becomes
Subject to the Exchange Act.
(i) Multiple Administrative Bodies. If permitted by Securities and
Exchange Commission Rule 16b-3 promulgated under the Exchange Act ("Rule
16b-3"), the Plan may be administered by different committees appointed by the
Board of Directors with respect to Directors, Officers, and Employees.
(ii) Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a committee of two or more "outside
directors" within the meaning of Section 162(m) of the Code.
(iii) Rule 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the Plan shall be administered by the
Board or a committee of two or more "non-employee directors" within the meaning
of Rule 16b-3.
3
<PAGE> 4
(iv) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which committee shall
be constituted to satisfy the legal requirements relating to the administration
of stock option plans, of applicable federal and state corporate and securities
laws, of the Code, and of any applicable stock exchange.
(c) Powers of the Administrator. Subject to the provisions of the Plan
and, in the case of a Committee, the specific duties delegated by the Board to
such Committee, and subject to the approval of any relevant authorities,
including the approval, if required, of any stock exchange upon which the Common
Stock is listed, the Administrator shall have the authority in its discretion:
(i) to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(l) of the Plan;
(ii) to select the Consultants and Employees to whom Options and
Stock Purchase Rights may from time to time be granted hereunder;
(iii) to determine whether and to what extent Options and Stock
Purchase Rights or any combination thereof are granted hereunder;
(iv) to determine the number of Shares to be covered by each such
award granted hereunder;
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions of any award granted
hereunder;
(vii) to determine whether and under what circumstances an Option
may be settled in cash under subsection 9(f) instead of Common Stock;
(viii) to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option has declined since the date the Option was granted;
(ix) to determine the terms and restrictions applicable to Stock
Purchase Rights and the Restricted Stock purchased by exercising such Stock
Purchase Rights;
(x) to provide for the early exercise of Options for the purchase
of unvested Shares, subject to such terms and conditions as the Administrator
may determine; and
(xi) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan.
4
<PAGE> 5
(d) Effect of Administrator's Decision. All decisions, determinations and
interpretations of the Administrator shall be final and binding on all Optionees
and any other holders of any Options or Stock Purchase Rights.
5. Eligibility.
(a) Nonstatutory Stock Options and Stock Purchase Rights may be granted
to Employees and Consultants. Incentive Stock Options may be granted only to
Employees. An Employee or Consultant who has been granted an Option or Stock
Purchase Right may, if otherwise eligible, be granted additional Options or
Stock Purchase Rights.
(b) Each Option shall be designated in the written option agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designations, to the extent that the aggregate Fair Market
Value of Shares subject to an Optionee's Incentive Stock Options granted by the
Company or any Parent or Subsidiary, that become exercisable for the first time
during any calendar year (under all plans of the Company or any Parent or
Subsidiary) exceeds $100,000, such excess Options shall be treated as
Nonstatutory Stock Options. For purposes of this Section 5(b), Incentive Stock
Options shall be taken into account in the order in which they were granted. The
Fair Market Value of the Shares shall be determined as of the time the Option
with respect to such Shares is granted.
(c) Neither the Plan nor any Option or Stock Purchase Right shall confer
upon any Optionee any right with respect to continuation of his or her
employment or consulting relationship with the Company, nor shall it interfere
in any way with his or her right or the Company's right to terminate his or her
employment or consulting relationship at any time, with or without cause.
(d) Upon the Company or a successor corporation issuing any class of
common equity securities required to be registered under Section 12 of the
Exchange Act or upon the Plan being assumed by a corporation having a class of
common equity securities required to be registered under Section 12 of the
Exchange Act, the following limitations shall apply to grants of Options and
Stock Purchase Rights to Employees:
(i) No Employee shall be granted, in any fiscal year of the
Company, Options and Stock Purchase Rights to purchase more than 1,000,000
Shares (after adjustment for the one-for-four reverse split of the Common Stock
effected in September 1996).
(ii) The foregoing limitation shall be adjusted proportionately in
connection with any change in the Company's capitalization as described in
Section 12.
(iii) If an Option or Stock Purchase Right is canceled in the same
fiscal year of the Company in which it was granted (other than in connection
with a transaction described in Section 12), the canceled Option shall be
counted against the limit set forth in Section 5(d)(i). For this purpose, if the
exercise price of an Option is reduced, such reduction will be treated as a
cancellation of the Option and the grant of a new Option.
6. Term of Plan. The Plan shall become effective upon the earlier to occur
of its adoption by the Board of Directors or its approval by the shareholders of
the Company, as described in Section 18 of the Plan. It shall continue in effect
for a term of ten (10) years unless sooner terminated under Section 14 of the
Plan.
7. Term of Option. The term of each Option shall be the term stated in the
Option Agreement; provided, however, that the term shall be no more than ten
(10) years from the date of grant thereof. In the case of an Incentive Stock
Option granted to an Optionee who, at the time the Option is granted, owns stock
5
<PAGE> 6
representing more than ten percent (10%) of the voting power of all classes of
stock of the Company or any Parent or Subsidiary, the term of the Option shall
be five (5) years from the date of grant thereof or such shorter term as may be
provided in the Option Agreement.
8. Option Exercise Price and Consideration.
(a) The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Administrator
but shall be subject to the following:
(i) In the case of an Incentive Stock Option
(1) granted to an Employee who, at the time of grant of
such Option, owns stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Company or any Parent or Subsidiary, the
per Share exercise price shall be no less than 110% of the Fair Market Value per
Share on the date of grant.
(2) granted to any other Employee, the per Share exercise
price shall be no less than 100% of the Fair Market Value per Share on the date
of grant.
(ii) In the case of a Nonstatutory Stock Option
(1) granted to a person who, at the time of grant of such
Option, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary, the per
Share exercise price shall be no less than 110% of the Fair Market Value per
Share on the date of the grant.
(2) granted to any other person, the per Share exercise
price shall be no less than 85% of the Fair Market Value per Share on the date
of grant.
(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator (and in the case of an Incentive Stock Option, shall be
determined at the time of grant). Such consideration may consist of (1) cash,
(2) check, (3) promissory note, (4) other Shares that (x) in the case of Shares
acquired upon exercise of an Option have been owned by the Optionee for more
than six months on the date of surrender and (y) have a Fair Market Value on
the date of surrender equal to the aggregate exercise price of the Shares as to
which such Option shall be exercised, (5) delivery of a properly executed
exercise notice together with such other documentation as the Administrator and
a broker, if applicable, shall require to effect an exercise of the Option and
delivery to the Company of the sale or loan proceeds required to pay the
exercise price, or (6) any combination of the foregoing methods of payment. In
making its determination as to the type of consideration to accept, the
Administrator shall consider whether acceptance of such consideration may be
reasonably expected to benefit the Company.
9. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted
hereunder shall be exercisable at such times and under such conditions as
determined by the Administrator, including performance criteria with respect to
the Company and/or the Optionee, and as shall be permissible under the terms of
the Plan.
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An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Administrator, consist of any
consideration and method of payment allowable under Section 8(b) hereof. Until
the issuance (as evidenced by the appropriate entry on the books of the Company
or of a duly authorized transfer agent of the Company) of the stock certificate
evidencing such Shares, no right to vote, receive dividends or any other rights
as a shareholder shall exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly upon exercise of the Option. No adjustment shall be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 12 hereof.
Exercise of an Option in any manner shall result in a decrease in the number of
Shares which thereafter may be available, both for purposes of the Plan and for
sale under the Option, by the number of Shares as to which the Option is
exercised.
Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(b) Termination of Employment or Consulting Relationship. In the event of
termination of an Optionee's Continuous Status as an Employee or Consultant (but
not in the event of an Optionee's change of status from Employee to Consultant
(in which case an Employee's Incentive Stock Option shall automatically convert
to a Nonstatutory Stock Option on the ninety-first (91st) day following such
change of status) or from Consultant to Employee), such Optionee may, but only
within such period of time as is determined by the Administrator, of at least
thirty (30) days, with such determination in the case of an Incentive Stock
Option not exceeding three (3) months after the date of such termination (but in
no event later than the expiration date of the term of such Option as set forth
in the Option Agreement), exercise his or her Option to the extent that the
Optionee was entitled to exercise it at the date of such termination. To the
extent that the Optionee was not entitled to exercise the Option at the date of
such termination, or if the Optionee does not exercise such Option to the extent
so entitled within the time specified herein, the Option shall terminate.
(c) Disability of Optionee. In the event of termination of an Optionee's
Continuous Status as an Employee or Consultant as a result of his or her
disability, the Optionee may, but only within twelve (12) months from the date
of such termination (and in no event later than the expiration date of the term
of such Option as set forth in the Option Agreement), exercise the Option to the
extent otherwise entitled to exercise it at the date of such termination. If
such disability is not a "disability" as such term is defined in Section
22(e)(3) of the Code, in the case of an Incentive Stock Option such Incentive
Stock Option shall automatically cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option on
the day three months and one day following such termination. To the extent that
the Optionee was not entitled to exercise the Option at the date of termination,
or if the Optionee does not exercise such Option to the extent so entitled
within the time specified herein, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan.
(d) Death of Optionee. In the event of the death of an Optionee, the
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration of the term of such Option
as set forth in the Notice of Grant) by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to
the extent that the Optionee
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<PAGE> 8
was entitled to exercise the Option on the date of death. If, at the time of
death, the Optionee was not entitled to exercise his or her entire Option, the
Shares covered by the unexercisable portion of the Option shall immediately
revert to the Plan. If, after the Optionee's death, the Optionee's estate or a
person who acquires the right to exercise the Option by bequest or inheritance
does not exercise the Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
(e) Buyout Provisions. The Administrator may at any time offer to buy out
for a payment in cash or Shares, an Option previously granted, based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.
10. Non-Transferability of Options and Stock Purchase Rights. Unless
determined otherwise by the Administrator, Options and Stock Purchase Rights may
not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any
manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee.
11. Stock Purchase Rights.
(a) Rights to Purchase. Stock Purchase Rights may be issued either alone,
in addition to, or in tandem with other awards granted under the Plan and/or
cash awards made outside of the Plan. After the Administrator determines that it
will offer Stock Purchase Rights under the Plan, it shall advise the offeree in
writing of the terms, conditions, and restrictions related to the offer,
including the number of Shares that such person shall be entitled to purchase,
the price to be paid, and the time within which such person must accept such
offer, which shall in no event exceed thirty (30) days from the date upon which
the Administrator makes the determination to grant the Stock Purchase Right. The
offer shall be accepted by execution of a Restricted Stock purchase agreement in
the form determined by the Administrator. Shares purchased pursuant to the grant
of a Stock Purchase Right shall be referred to herein as "Restricted Stock."
(b) Repurchase Option. Unless the Administrator determines otherwise, the
Restricted Stock purchase agreement shall grant the Company a repurchase option
exercisable upon the voluntary or involuntary termination of the purchaser's
employment with the Company for any reason (including death or Disability). The
purchase price for Shares repurchased pursuant to the Restricted Stock purchase
agreement shall be the original price paid by the purchaser and may be paid by
cancellation of any indebtedness of the purchaser to the Company. The repurchase
option shall lapse at such rate as the Administrator may determine.
(c) Other Provisions. The Restricted Stock purchase agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion. In
addition, the provisions of Restricted Stock purchase agreements need not be the
same with respect to each purchaser.
(d) Rights as a Shareholder. Once the Stock Purchase Right is exercised,
the purchaser shall have rights equivalent to those of a shareholder and shall
be a shareholder when his or her purchase is entered upon the records of the
duly authorized transfer agent of the Company. No adjustment shall be made for a
dividend or other right for which the record date is prior to the date the Stock
Purchase Right is exercised, except as provided in Section 12 of the Plan.
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<PAGE> 9
12. Adjustments Upon Changes in Capitalization or Merger.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option or Stock Purchase Right, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or which have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company. The conversion of any convertible securities of
the Company shall not be deemed to have been "effected without receipt of
consideration." Such adjustment shall be made by the Board, whose determination
in that respect shall be final, binding and conclusive. Except as expressly
provided herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Option or Stock Purchase Right.
(b) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, the Administrator shall notify the Optionee at
least fifteen (15) days prior to such proposed action. To the extent it has not
been previously exercised, the Option or Stock Purchase Right shall terminate
immediately prior to the consummation of such proposed action.
(c) Merger. In the event of a merger of the Company with or into another
corporation or the sale of all or substantially all of the assets of the
Company, each outstanding Option or Stock Purchase Right shall be assumed or an
equivalent option or right shall be substituted by such successor corporation or
a parent or subsidiary of such successor corporation. In the event the successor
corporation refuses to assume or substitute for the Option, the Board shall have
the discretion either (i) to permit each Optionee to exercise the Option as to
all of the Optioned Stock, including Shares as to which it would not otherwise
be exercisable or (ii) to terminate the Option with respect to unvested Shares.
If an Option is exercisable in lieu of assumption or substitution in the event
of a merger or sale of assets, the Board shall notify the Optionee that the
Option shall be fully exercisable for a period of fifteen (15) days from the
date of such notice, and the Option shall terminate upon the expiration of such
period. For the purposes of this paragraph, the Option or Stock Purchase Right
shall be considered assumed if, following the merger or asset sale, the Option
or Stock Purchase Right confers the right to purchase or receive, for each Share
of Optioned Stock subject to the Option or Stock Purchase Right immediately
prior to the merger, the consideration (whether stock, cash, or other securities
or property) received in the merger or asset sale by holders of Common Stock for
each Share held on the effective date of the transaction (and if the holders are
offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares). If such consideration received
in the merger is not solely common stock of the successor corporation or its
parent, the Administrator may, with the consent of the successor corporation,
provide for the consideration to be received upon the exercise of the Option or
Stock Purchase Right, for each Share of Optioned Stock subject to the Option or
Stock Purchase Right, to be solely common stock of the successor corporation or
its parent equal in fair market value to the per share consideration received by
holders of Common Stock in the merger or asset sale.
13. Time of Granting Options and Stock Purchase Rights. The date of grant of
an Option or Stock Purchase Right shall, for all purposes, be the date on which
the Administrator makes the determination granting
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<PAGE> 10
such Option or Stock Purchase Right, or such other date as is determined by the
Administrator. Notice of the determination shall be given to each Employee or
Consultant to whom an Option or Stock Purchase Right is so granted within a
reasonable time after the date of such grant.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend, alter,
suspend or discontinue the Plan, but no amendment, alteration, suspension or
discontinuation shall be made which would impair the rights of any Optionee
under any grant theretofore made, without his or her consent.
(b) Effect of Amendment or Termination. Any such amendment or termination
of the Plan shall not affect Options or Stock Purchase Rights already granted,
and such Options and Stock Purchase Rights shall remain in full force and effect
as if this Plan had not been amended or terminated, unless mutually agreed
otherwise between the Optionee and the Administrator, which agreement must be in
writing and signed by the Optionee and the Company.
15. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option or Stock Purchase Right unless the exercise of such
Option or Stock Purchase Right and the issuance and delivery of such Shares
pursuant thereto shall comply with all relevant provisions of law, including,
without limitation, the Securities Act of 1933, as amended, the Exchange Act,
the rules and regulations promulgated thereunder, and the requirements of any
stock exchange upon which the Shares may then be listed, and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
As a condition to the exercise of an Option or Stock Purchase Right, the
Company may require the person exercising such Option or Stock Purchase Right to
represent and warrant at the time of any such exercise that the Shares are being
purchased only for investment and without any present intention to sell or
distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required by any of the aforementioned relevant provisions of
law.
16. Reservation of Shares. The Company, during the term of this Plan, shall
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
The inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, shall relieve
the Company of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority shall not have been obtained.
17. Agreements. Options and Stock Purchase Rights shall be evidenced by
written agreements in such form as the Administrator shall approve from time to
time.
18. Shareholder Approval. Continuance of the Plan shall be subject to
approval by the shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such shareholder approval shall be obtained
in the degree and manner required under applicable state and federal law and the
rules of any stock exchange upon which the Common Stock is listed.
19. Information to Optionees and Purchasers. The Company shall provide to
each Optionee and to each individual who acquires Shares pursuant to the Plan,
not less frequently than annually during the period
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<PAGE> 11
such Optionee or purchaser has one or more Options or Stock Purchase Rights
outstanding, and, in the case of an individual who acquires Shares pursuant to
the Plan, during the period such individual owns such Shares, copies of annual
financial statements. The Company shall not be required to provide such
statements to key employees whose duties in connection with the Company assure
their access to equivalent information.
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<PAGE> 1
EXHIBIT 4.2
AURUM SOFTWARE, INC.
1996 DIRECTOR OPTION PLAN
1. Purposes of the Plan. The purposes of this Aurum Software, Inc., 1996
Director Option Plan are to attract and retain the best available personnel for
service as Outside Directors (as defined herein) of the Company, to provide
additional incentive to the Outside Directors of the Company to serve as
Directors, and to encourage their continued service on the Board.
All options granted hereunder shall be nonstatutory stock options.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Common Stock" shall mean the Common Stock of the Company.
(d) "Company" shall mean Aurum Software, Inc., a Delaware corporation.
(e) "Director" shall mean a member of the Board.
(f) "Employee" shall mean any person, including officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a Director's fee by the Company shall not be sufficient in and of itself to
constitute "employment" by the Company.
(g) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(h) "Fair Market Value" shall mean, as of any date, the value of Common
Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including, without limitation, the
National Market of The Nasdaq Stock Market, the Fair Market Value of a Share of
Common Stock shall be the closing sales price for such stock (or the closing
bid, if no sales were reported) as quoted on such system or exchange (or the
exchange with the greatest volume of trading in Common Stock) on the date of
determination, as reported in The Wall Street Journal or such other source as
the Board deems reliable;
(ii) If the Common Stock is quoted on The Nasdaq Stock Market (but
not on the National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the date of determination, as reported in The
Wall Street Journal or such other source as the Board deems reliable, or;
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(iii) In the absence of an established market for the
Common Stock, the Fair Market Value thereof shall be determined in good faith by
the Board.
(i) "Inside Director" shall mean a Director who is an Employee.
(j) "Option" shall mean a stock option granted pursuant to the Plan.
(k) "Optioned Stock" shall mean the Common Stock subject to an Option.
(l) "Optionee" shall mean a Director who holds an Option.
(m) "Outside Director" shall mean a Director who is not an Employee.
(n) "Parent" shall mean a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(o) "Plan" shall mean this 1996 Director Option Plan.
(p) "Share" shall mean a share of Common Stock, as adjusted in accordance
with Section 10 of the Plan.
(q) "Subsidiary" shall mean a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Internal Revenue Code of
1986.
3. Stock Subject to the Plan. Subject to the provisions of Section 10 of the
Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 150,000* Shares of Common Stock (the "Pool"). The Shares may
be authorized, but unissued, or reacquired Common Stock.
If an Option expires or becomes unexercisable without having been
exercised in full, the unpurchased Shares which were subject thereto shall
become available for future grant or sale under the Plan (unless the Plan has
terminated). Shares that have actually been issued under the Plan shall not be
returned to the Plan and shall not become available for future distribution
under the Plan.
4. Administration and Grants of Options under the Plan.
(a) Procedure for Grants. All grants of Options to Outside Directors
under this Plan shall be automatic and nondiscretionary and shall be made
strictly in accordance with the following provisions:
(i) No person shall have any discretion to select which Outside
Directors shall be granted Options or to determine the number of Shares to be
covered by Options granted to Outside Directors.
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* After adjustment for the one-for-four reverse split of the Common Stock in
October 1996.
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<PAGE> 3
(ii) Each Outside Director shall be automatically granted an
Option to purchase 18,750 Shares* (the "First Option") on the date on which such
person first becomes an Outside Director, whether through election by the
stockholders of the Company or appointment by the Board to fill a vacancy;
provided, however, that an Inside Director who ceases to be an Inside Director
but who remains a Director shall not receive a First Option; and provided
further, that any Outside Director who already serves in such capacity on the
date of adoption of the Plan by the Board shall not receive a First Option.
(iii) Each Outside Director shall be automatically granted an
Option to purchase 4,688 Shares* (a "Subsequent Option") at the next meeting of
the Board of Directors following the Annual Meeting of Stockholders in each year
commencing with the 1997 Annual Meeting of Stockholders provided he or she is
then an Outside Director and if as of such date, he or she shall have served on
the Board for at least the preceding six (6) months.
(iv) Notwithstanding the provisions of subsections (ii) and (iii)
hereof, any exercise of an Option made before the Company has obtained
stockholder approval of the Plan in accordance with Section 16 hereof shall be
conditioned upon the Company's obtaining such stockholder approval of the Plan
in accordance with Section 16 hereof.
(v) The terms of a First Option granted hereunder shall be as
follows:
(A) the term of the First Option shall be ten (10) years.
(B) the First Option shall be exercisable only while the
Outside Director remains a Director of the Company, except as set forth in
Sections 8 and 10 hereof.
(C) the exercise price per Share shall be one hundred
percent (100%) of the Fair Market Value per Share on the date of grant of the
First Option. In the event that the date of grant of the First Option is not a
trading day, the exercise price per Share shall be one hundred percent (100%) of
the Fair Market Value on the next trading day immediately following the date of
grant of the First Option; provided, however, that in connection with the grant
of a First Option upon effectiveness of the Plan as a result of the initial
public offering of the Company's Common Stock, the exercise price per Share for
such First Option shall equal the initial public offering price.
(D) subject to Section 10 hereof, the First Option shall
become exercisable as to twenty-five percent (25%) of the Shares subject to the
First Option one year after its date of grant and as to 1/48th of the shares
each month thereafter so that the first Option shall be fully exercisable four
(4) years after the date of grant, provided that the Optionee continues to serve
as a Director on such dates.
(vi) The terms of a Subsequent Option granted hereunder shall be
as follows:
(A) the term of the Subsequent Option shall be ten (10)
years.
(B) the Subsequent Option shall be exercisable only while
the Outside Director remains a Director of the Company, except as set forth in
Sections 8 and 10 hereof.
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* After adjustment for the one-for-four reverse split of the Common Stock in
October 1996.
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(C) the exercise price per Share shall be one hundred
percent (100%) of the Fair Market Value per Share on the date of grant of the
Subsequent Option. In the event that the date of grant of the Subsequent Option
is not a trading day, the exercise price per Share shall be one hundred percent
(100%) of the Fair Market Value on the next trading day immediately following
the date of grant of the Subsequent Option.
(D) subject to Section 10 hereof, the Subsequent Option
shall become exercisable as to 1/48th of the Shares subject to the Subsequent
Option on each monthly anniversary of its date of grant, provided that the
Optionee continues to serve as a Director on such dates.
(vii) In the event that any Option granted under the Plan would
cause the number of Shares subject to outstanding Options plus the number of
Shares previously purchased under Options to exceed the Pool, then the remaining
Shares available for Option grant shall be granted under Options to the Outside
Directors on a pro rata basis. No further grants shall be made until such time,
if any, as additional Shares become available for grant under the Plan through
action of the Board or the stockholders to increase the number of Shares which
may be issued under the Plan or through cancellation or expiration of Options
previously granted hereunder.
5. Eligibility. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth in
Section 4 hereof.
The Plan shall not confer upon any Optionee any right with respect to
continuation of service as a Director or nomination to serve as a Director, nor
shall it interfere in any way with any rights which the Director or the Company
may have to terminate the Director's relationship with the Company at any time.
6. Term of Plan. The Plan shall become effective upon the later to occur of
its approval by the stockholders of the Company as described in Section 16 of
the Plan or the effective date of the Company's initial public offering of its
Common Stock that is registered with the Securities and Exchange Commission. It
shall continue in effect for a term of ten (10) years unless sooner terminated
under Section 11 of the Plan.
7. Form of Consideration. The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall
consist of (i) cash, (ii) check, (iii) other shares which (x) in the case of
Shares acquired upon exercise of an Option, have been owned by the Optionee for
more than six (6) months on the date of surrender, and (y) have a Fair Market
Value on the date of surrender equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised, (iv) delivery of a properly
executed exercise notice together with such other documentation as the Company
and the broker, if applicable, shall require to effect an exercise of the Option
and delivery to the Company of the sale or loan proceeds required to pay the
exercise price, or (v) any combination of the foregoing methods of payment.
8. Exercise of Option.
(a) Procedure for Exercise; Rights as a Stockholder. Any Option granted
hereunder shall be exercisable at such times as are set forth in Section 4
hereof; provided, however, that no Options shall be exercisable until
stockholder approval of the Plan in accordance with Section 16 hereof has been
obtained.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full
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<PAGE> 5
payment for the Shares with respect to which the Option is exercised has been
received by the Company. Full payment may consist of any consideration and
method of payment allowable under Section 7 of the Plan. Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. A share certificate for the number of Shares so acquired
shall be issued to the Optionee as soon as practicable after exercise of the
Option. No adjustment shall be made for a dividend or other right for which the
record date is prior to the date the stock certificate is issued, except as
provided in Section 10 of the Plan.
Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(b) Termination of Continuous Status as a Director. Subject to Section 10
hereof, in the event an Optionee's status as a Director terminates (other than
upon the Optionee's death or total and permanent disability (as defined in
Section 22(e)(3) of the Code)), the Optionee may exercise his or her Option, but
only within three (3) months following the date of such termination, and only to
the extent that the Optionee was entitled to exercise it on the date of such
termination (but in no event later than the expiration of its ten (10) year
term). To the extent that the Optionee was not entitled to exercise an Option on
the date of such termination, and to the extent that the Optionee does not
exercise such Option (to the extent otherwise so entitled) within the time
specified herein, the Option shall terminate.
(c) Disability of Optionee. In the event Optionee's status as a Director
terminates as a result of total and permanent disability (as defined in Section
22(e)(3) of the Code), the Optionee may exercise his or her Option, but only
within twelve (12) months following the date of such termination, and only to
the extent that the Optionee was entitled to exercise it on the date of such
termination (but in no event later than the expiration of its ten (10) year
term). To the extent that the Optionee was not entitled to exercise an Option on
the date of termination, or if he or she does not exercise such Option (to the
extent otherwise so entitled) within the time specified herein, the Option shall
terminate.
(d) Death of Optionee. In the event of an Optionee's death, the
Optionee's estate or a person who acquired the right to exercise the Option by
bequest or inheritance may exercise the Option, but only within twelve (12)
months following the date of death, and only to the extent that the Optionee was
entitled to exercise it on the date of death (but in no event later than the
expiration of its ten (10) year term). To the extent that the Optionee was not
entitled to exercise an Option on the date of death, and to the extent that the
Optionee's estate or a person who acquired the right to exercise such Option
does not exercise such Option (to the extent otherwise so entitled) within the
time specified herein, the Option shall terminate.
9. Non-Transferability of Options. The Option may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee.
10. Adjustments Upon Changes in Capitalization, Dissolution, Merger,
Asset Sale or Change of Control.
(a) Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of Shares covered by each outstanding
Option, the number of Shares which have been
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<PAGE> 6
authorized for issuance under the Plan but as to which no Options have yet been
granted or which have been returned to the Plan upon cancellation or expiration
of an Option, as well as the price per Share covered by each such outstanding
Option, and the number of Shares issuable pursuant to the automatic grant
provisions of Section 4 hereof shall be proportionately adjusted for any
increase or decrease in the number of issued Shares resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
Shares effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Except as
expressly provided herein, no issuance by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of Shares subject to an Option.
(b) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, to the extent that an Option has not been
previously exercised, it shall terminate immediately prior to the consummation
of such proposed action.
(c) Merger or Asset Sale. In the event of a merger of the Company with or
into another corporation, or the sale of all or substantially all of the assets
of the Company, each outstanding Option may be assumed or an equivalent option
may be substituted by the successor corporation or a Parent or Subsidiary
thereof (the "Successor Corporation"). If the Successor Corporation assumes or
substitutes an equivalent option for the Option, the Option or equivalent option
shall continue to become exercisable as provided in Section 4 hereof for so long
as Optionee remains a Director or the Optionee serves as a director of the
Successor Corporation. Following such assumption or substitution, if the
Optionee's status as a Director or director of the Successor Corporation, as
applicable, is terminated other than upon a voluntary resignation by the
Optionee, the Option or option shall become fully exercisable, including as to
Shares for which it would not otherwise be exercisable. Thereafter, the Option
or option shall remain exercisable in accordance with Sections 8(c) through (e)
above.
In the event that the Successor Corporation does not agree to assume the
Option or to substitute an equivalent option, each outstanding Option shall
become fully vested and exercisable, including as to Shares as to which it would
not otherwise be exercisable. In such event, the Board shall notify the Optionee
that the Option shall be fully exercisable for a period of thirty (30) days from
the date of such notice, and the Option shall terminate upon the expiration of
such period. For the purposes of this Section 10(c), the Option shall be
considered assumed if, following the merger or sale of assets, the Option
confers the right to purchase, for each Share of Optioned Stock subject to the
Option immediately prior to the merger or sale of assets, the consideration
(whether stock, cash, or other securities or property) received in the merger or
sale of assets by holders of Common Stock for each Share held on the effective
date of the transaction (and if holders were offered a choice of consideration,
the type of consideration chosen by the holders of a majority of the outstanding
Shares).
11. Amendment and Termination of the Plan.
(a) Amendment and Termination. Except as set forth in Section 4, the
Board may at any time amend, alter, suspend, or discontinue the Plan, but no
amendment, alteration, suspension, or discontinuation shall be made which would
impair the rights of any Optionee under any grant theretofore made, without his
or her consent. In addition, to the extent necessary and desirable to comply
with Rule 16b-3 under the Exchange Act (or any other applicable law or
regulation), the Company shall obtain stockholder approval of any Plan amendment
in such a manner and to such a degree as required.
6
<PAGE> 7
(b) Effect of Amendment or Termination. Any such amendment or termination
of the Plan shall not affect Options already granted and such Options shall
remain in full force and effect as if this Plan had not been amended or
terminated.
12. Time of Granting Options. The date of grant of an Option shall, for all
purposes, be the date determined in accordance with Section 4 hereof.
13. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option unless the exercise of such Option and the issuance
and delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder,
state securities laws, and the requirements of any stock exchange upon which the
Shares may then be listed, and shall be further subject to the approval of
counsel for the Company with respect to such compliance.
As a condition to the exercise of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares, if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned relevant provisions of law.
Inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, shall relieve
the Company of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority shall not have been obtained.
14. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
15. Option Agreement. Options shall be evidenced by written option
agreements in such form as the Board shall approve.
16. Stockholder Approval. Continuance of the Plan shall be subject to
approval by the stockholders of the Company at or prior to the first annual
meeting of stockholders held subsequent to the granting of an Option hereunder.
Such stockholder approval shall be obtained in the degree and manner required
under applicable state and federal law.
7
<PAGE> 1
EXHIBIT 5.1
DE BRAUW BLACKSTONE WESTBROEK
advocaten & notarissen
in samenwerking wet
DE BANDT, VAN HECKE & LAGAE
Postbus 75084
1070 AB Amsterdam
Tripolis 300
Burgerweeshuispad 301
Telefoon 020 5771 771
Telefax 020 5771 775
Baan Company N.V.
Baron van Nagellstraat 89
3371 LK BARNEVELD
The Netherlands
Amsterdam, August 27, 1997
Our ref.: 276\2008710\opS8-2.566
Ladies and Gentlemen,
Baan Company N.V.
Registration under the Securities Act of 1933
of up to 522,643 common shares
in the share capital of Baan Company N.V.
I have acted as legal counsel in respect of the law of the Netherlands to Baan
Company N.V. (the "Company"), a company incorporated under the law of the
Netherlands with its corporate seat in Barneveld, the Netherlands, in connection
with the contemplated issuance of up to 522,643 common shares (the "OPTION
SHARES"), each with a nominal value of NLG 0.01, in the share capital of the
Company, pursuant to options to be granted by the Company under the Agreement
(as referred to in (g)) in exchange for all outstanding rights to acquire shares
in the capital of Aurum Software, Inc., which shares are the subject of a
registration statement on Form S-8 (the "REGISTRATION STATEMENT") to be filed
with the United States Securities and Exchange Commission ("SEC") under the
United States Securities Act of 1993, as amended, on or about August 27, 1997.
<PAGE> 2
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In connection herewith I have examined the following documents:
(a) a photocopy of the deed of incorporation of the Company and the text of
the articles of association of the Company as most recently amended
according to the Extract (as defined below) by deed of amendment
executed on May 29, 1996 (the "ARTICLES OF ASSOCIATION"), both as filed
with the trade register of the Chamber of Commerce and Industry of
Centraal Gelderland, the Netherlands (the "TRADE REGISTER");
(b) an extract (the "EXTRACT") dated August 22, 1997 from the Trade Register
with information regarding the Company (provided that it should be noted
that certain information included in the Extract, not material for the
purpose of rendering this opinion, is incorrect), and confirmed to me by
telephone by the Trade Register to be unchanged in all respects material
for rendering this opinion on the date hereof;
(c) a copy of the minutes of the general meeting of shareholders of the
Company held on April 11, 1996 and a telecopy dated July 17, 1997 of the
(unsigned) minutes of the general meeting of shareholders of the
Company, held on May 20, 1997;
(d) a telecopy of the minutes of the collective meeting of the board of
supervisory directors ("raad van commissarissen") and the board of
managing directors ("directie") of the Company held on May 12, 1997;
(e) a telecopy of an executed copy of the resolutions, adopted by the board
of supervisory directors of the Company (lastly) on August 20, 1997;
(f) a telecopy of an executed copy of the resolutions adopted by the board
of managing directors of the Company (lastly) on August 22, 1997;
<PAGE> 3
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(g) a telecopy dated July 22, 1997 of an executed copy of an agreement and plan
of reorganization, dated May 13, 1997 among the Company, Green Software
Acquisition Corporation and Aurum Software, Inc. (the "Agreement");
(h) a telecopy dated August 21, 1997 of an undated draft of the Registration
Statement;
(i) a telecopy dated August 7, 1997 of the amended and restated 1995 Aurum
Stock Option Plan (as amended on September 11, 1996) and the 1996 Aurum
Director Option Plan (together the "Aurum Stock Plans");
My examination referred to above has been limited to the face of the documents.
For the purposes of rendering this opinion I have made the following
assumptions:
(i) the signatures on original documents are the genuine signatures of the
persons purported to have executed the same and photo and telecopies
conform to the originals;
(ii) the Registration Statement has been or will be filed with the SEC
substantially in the form of the draft which I have reviewed for the
purpose of rendering this opinion as specified under (h) above;
(iii) the resolutions referred to in (e) above have been adopted prior to the
resolutions mentioned under (f) above;
(iv) the resolutions as referred to in (d), (e) and (f) below are not contrary
to standards of
<PAGE> 4
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reasonableness and fairness ("redelijkheid en billijkheid") to be
observed by a legal entity and those persons, who are pursuant to the
law or the articles of association of such legal entity, involved in its
organisation;
(v) the Agreement has been duly authorized, executed and delivered by or in
name of all the parties thereto and that the Agreement, when duly
authorized, executed and delivered, constitutes valid, binding and
enforceable obligations of all parties thereto (including the
Company) under the laws of the State of Delaware, to which it is
expressed to be subject;
(vi) the Option Shares will be issued, offered, sold, delivered, duly
accepted by the subscribers therefor, (a) as contemplated and in
accordance with (i) any of the Aurum Stock Plans and (ii) the
Registration Statement, (b) in accordance with the articles of
association of the Company as in force at the time of issuance of any
such Option Shares and (c) in accordance with, and with such terms so
as not to violate, any applicable law (including, for the avoidance of
doubt, any law applicable at the time of such issue, offer, sale,
delivery and acceptance);
(vii) the Aurum Stock Plans are duly authorized, executed and delivered by or
in the name of all the parties thereto and that the Aurum Stock Plans,
when duly authorized, executed and delivered
<PAGE> 5
-5-
constitute valid, binding and enforceable obligations of all
parties thereto (including Aurum Software, Inc.) under any
applicable law;
(viii) upon issue of each Option Share at least a consideration (in
cash or in kind) will be paid to the Company for such Option
Share with a value equal to the aggregate of (i) the nominal
amount thereof and (ii) any premium agreed upon at the issue
thereof in accordance with the law of the Netherlands, and that
in the event the consideration for an Option Share will be paid
in kind each time (i) a description in connection with article
94b paragraph 1 of Book 2 of the Netherlands Civil Code will be
prepared by the Company and signed by all members of the board
of managing directors of the Company and (ii) a statement in
connection with article 94b paragraph 2 of Book 2 of the
Netherlands Civil Code will be rendered by the auditors of the
Company
(ix) each time when an Option Share is issued, the authorized
capital ("maatschappelijk kapitaal") and the issued capital
("geplaatst kapitaal") of the Company are such that such Option
Share can be validly issued;
(x) shortly upon issue the Option Shares will be admitted to the
Official Market of the AEX-Effectenbeurs N.V;
(xi) no rights to acquire shares in the Company will be granted
under or in connection with the Aurum Stock Plans after the
date hereof.
I have not investigated the law of any jurisdiction other than the Netherlands
and I do not express an opinion on the law of any jurisdiction other than the
Netherlands. I only express an opinion on matters of the law of the Netherlands
as it stands and has been published as at the date of this opinion. No opinion
is expressed on any taxation matters.
Terms and expressions of law and of legal concepts as used in this opinion have
the meaning in this opinion attributed to them under the law of the Netherlands
and this opinion should be read and understood accordingly.
Based upon the foregoing (including the documents listed above and the
assumptions set out above in paragraphs (i) up to and including (xi) and subject
to the qualifications listed in paragraphs (aa) up to and including (ff) and
subject to any factual matters, circumstances, events or documents not disclosed
to me in the
<PAGE> 6
-6-
course of my examination referred to above, I am, at the date hereof, of the
following opinion:
1. The Company has been duly incorporated and is validly existing under the
law of the Netherlands as a legal entity in the form of a "naamloze
vennootschap" (public company with limited liability).
2. The Option Shares have been duly authorized and will be validly issued
by the Company in accordance with the law of the Netherlands and the
provisions of the Articles of Association applicable thereto and will
upon issue will be fully paid up and non-assessable.
The opinions expressed above are subject to the following qualifications:
(aa) Pursuant to Article 3 paragraph 1 of the Netherlands 1995 Act on the
supervision of the securities trade ("Wet Toezicht Effectenverkeer
1995", the "Securities Act") it is prohibited to offer securities upon
issue in or from within the Netherlands and outside a closed circle or
to hold the prospect of such offering by means of advertisements or
documents. The Netherlands Securities Board ("Stichting Toezicht
Effectenverkeer") generally takes the view that the offering of
securities by a company to employees, managing directors or supervisory
directors thereof and to employees, managing directors or supervisory
directors of subsidiaries ("dochtermaatschappijen") of such company
within the meaning of article 24a Book of 2 of the Netherlands Civil
Code falls within a "closed circle" within the meaning of article 3
paragraph 1 of the Securities Act. According to the Netherlands
Securities Board an offering of securities to a broader group of
securities of persons, including e.g. consultants, does not fall within
such "closed circle". It is uncertain what
<PAGE> 7
-7-
the legal consequences are of acting in breach of the prohibition as
set out in article 3 paragraph 1 of the Securities Act. It cannot be
excluded that the relevant legal act is null and void or voidable;
(bb) the opinions expressed herein are limited by any applicable bankruptcy,
moratorium and other similar laws (including statutory preferences)
affecting creditors' rights generally;
(cc) to the extent Netherlands law is applicable, the enforcement of
obligations of the Company and the other parties to the Agreement may be
limited to the extent that a court may, as a result of a general
principle of Netherlands civil law, in an exceptional situation -
dependent upon all relevant circumstances of the particular case - deem
enforcement contrary according to the concept of reasonableness
and fairness ("redelijheid en billijkheid");
(dd) article 8 of Book 2 of the Netherlands Civil Code provides that a legal
entity and the persons who, by virtue of the law or its articles of
association, are involved with its organisation must, in such capacity,
conduct themselves in relation to each other in accordance with the
requirements of reasonableness and fairness ("redelijkheid en
billijkheid"). A rule which is binding them by virtue of the law, usage,
the articles of association, bylaws or a resolution shall not apply to
the extent that, in the circumstances, such is unacceptable according to
standards of reasonableness and fairness;
(ee) (without derogating from opinion 2 hereof) no opinion is rendered with
respect to any of the Aurum Stock Plans;
(ff) no opinion is rendered with respect to the assumption by the Company
under the Agreement of the Aurum Stock Plans.
Without my prior written consent, this opinion letter may not be transmitted to
or filed with any other person, firm, company or institution.
I herewith consent to the filing of this opinion as an exhibit to the
Registration Statement and to the incorporation by reference of the reference
to the Brauw Blackstone Westbroek in the prospectus included in the
Registration Statement under the heading "Interests of Named Experts and
Counsel". In giving such consent, I do not thereby admit that I am in the
category of persons whose consent is required under Section 7 of the United
States Securities Act of 1993, as amended.
Very truly yours,
/s/ PAUL CRONHEIM
----------------------------
Paul Cronheim
<PAGE> 1
EXHIBIT 23.1
Consent of Moret Ernst & Young Accountants, Independent Auditors
We consent to the incorporation by reference in this Registration Statement
(Form S-8) pertaining to the Aurum Software, Inc. Amended 1995 Stock Option
Plan of our report dated January 24, 1997, with respect to the consolidated
financial statements of Baan Company N.V. included in its Annual Report (Form
20-F) for the year ended December 31, 1996, filed with the Securities and
Exchange Commission.
/s/ MORET ERNST & YOUNG ACCOUNTANTS
-----------------------------------
Moret Ernst & Young Accountants
Utrecht, The Netherlands
August 26, 1997
