As filed with the Securities and Exchange Commission on July 23, 1996
Registration Statement No. 333-________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
________________________
AUTODESK, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
________________________
DELAWARE 94-2819853
_____________________________ ____________________________________
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
111 McInnis Parkway, San Rafael, California 94903
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
________________________
1996 STOCK PLAN
1990 DIRECTOR'S OPTION PLAN
EMPLOYEE QUALIFIED STOCK PURCHASE PLAN
TELEOS RESEARCH 1996 STOCK OPTION PLAN
(FULL TITLE OF THE PLANS)
________________________
MARCIA K. STERLING, ESQ.
VICE PRESIDENT, BUSINESS
DEVELOPMENT AND GENERAL COUNSEL
AUTODESK, INC.
111 MCINNIS PARKWAY
SAN RAFAEL, CA 94903
(415) 507-5000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
________________________
Copy to:
Don S. Williams, Esq.
Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304-1050
(415) 493-9300
________________________
CALCULATION OF REGISTRATION FEE
======================================================================================================================
Proposed Maximum Proposed Amount of
Title of Securities Amount to be Offering Price Maximum Aggregate Registration
to be Registered Registered Per Share(1) Offering Price Fee(2)
______________________________________________________________________________________________________________________
Common Stock, $.01 par value..........
- Newly reserved under 1990
Directors' Option Plan........... 200,000 $21.6875 $ 4,337,500(3) $ 1,495.69
- Newly reserved under Employee
Qualified Stock Purchase Plan.... 500,000 $21.6875 $10,843,750(3) $ 3,739.22
- Newly reserved under 1996 Stock
Plan............................. 1,500,000 $21.6875 $32,531,250(3) $11,217.67
- Outstanding under Teleos Research
1996 Stock Plan (4).............. 100,000 $34.75 $ 3,475,000(5) $ 1,198.28
TOTAL...................... 2,300,000 $51,187,500 $17,650.86
======================================================================================================================
____________________________
(1) Estimated in accordance with Rule 457(h) solely for the purpose of
calculating the registration fee.
(2) Amount of the Registration Fee was calculated pursuant to Section 6(b) of
the Securities Act of 1933, as amended, which states that the fee shall be
"one twenty-ninth of one percentum of the maximum aggregate price at which
the securities are issued."
(3) Estimated in accordance with Rule 457(h) solely for the purpose of
calculating the filing fee on the basis of $21.6875 per share, which
represents the average of the high and the low prices reported on the
Nasdaq National Market on July 16, 1996.
(4) Pursuant to the Agreement and Plan of Reorganization entered into as of
May 17, 1996, by and among Autodesk, Inc., Exegis Technologies, Teleos
Research and Teleos Corporation, the Registrant assumed all of the
outstanding options to purchase Common Stock of Teleos Research under the
1996 Stock Plan, and such options became exercisable to purchase shares of
Autodesk Common Stock, subject to appropriate adjustments to the number of
shares and the exercise price of each such assumed option.
(5) Estimated in accordance with Rule 457(h) solely for the purpose of
calculating the filing fee on the basis of the weighted average exercise
price of $34.75 per share for outstanding options to purchase a total of
100,000 shares of Common Stock.
AUTODESK, INC.
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
---------------------------------------
There are hereby incorporated by reference in this Registration Statement
the following documents and information heretofore filed with the Securities and
Exchange Commission:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended January 31, 1996, filed pursuant to Section 13 of the Securities
Exchange Act of 1934, as amended (the "1934 Act");
(b) The Company's Quarterly Report on Form 10-Q for the quarter
ended April 30, 1996, filed pursuant to Section 13 of the 1934 Act;
(c) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A dated March 18, 1986 pursuant
to Section 12(g) of the 1934 Act.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the 1934 Act on or after the date of this Registration Statement
and 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 in this
Registration Statement and to be part hereof from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
-------------------------
Not Applicable
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
--------------------------------------
Mark Bertelsen, a director of the Registrant, is a member of Wilson
Sonsini Goodrich & Rosati, which has given an opinion upon the validity of the
securities being registered by this Registration Statement.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
------------------------------------------
As permitted by Section 145 of the Delaware General Corporation Law, the
Registrant's Certificate of Incorporation, as amended, includes a provision that
eliminates the personal liability of its directors for monetary damages for
breach or alleged breach of their duty of care. In addition, as permitted by
Section 145 of the Delaware General Corporation Law, the Bylaws of the
Registrant provide that: (i) the Registrant is required to indemnify its
directors and officers and persons serving in such capacities in other business
enterprises (including, for example, subsidiaries of the Registrant) at the
Registrant's request, to the fullest extent permitted by Delaware law; (ii) the
Registrant may, in its discretion, indemnify employees and agents in those
circumstances where indemnification is not required by law; (iii) the Registrant
is required to advance expenses, as incurred, to its directors and officers in
connection with defending a proceeding, provided that payment of expenses
incurred by a director or officer of the corporation in advance of the final
disposition of such proceeding shall be made only on receipt of an undertaking
by
II-1
the officer or director to repay all amounts advanced if it should ultimately
be determined that the officer or director is not entitled to be indemnified;
(iv) the rights conferred in the Bylaws are not exclusive, and the Registrant is
authorized to enter into indemnification agreements with its directors, officers
and employees; and (v) the Registrant may not retroactively amend the Bylaw
provisions in a way that is adverse to such directors, officers and employees.
The Registrant's policy is to enter into indemnification agreements with
each of its directors and officers that provide the maximum indemnity allowed to
directors and officers by Section 145 of the Delaware General Corporation Law
and the Bylaws, as well as certain additional procedural protections. In
addition, the indemnification agreements provide that directors and officers
will be indemnified to the fullest possible extent permitted by law against all
expenses (including attorney's fees) and settlement amounts paid or incurred by
them in an action or proceeding, including any action by or in the right of the
Registrant, arising out of such person's services as a director or officer of
the Registrant, any subsidiary of the Registrant or any other company or
enterprise to which such person provides services at the request of the
Registrant. The Registrant will not be obligated pursuant to the
indemnification agreements to indemnify or advance expenses to an indemnified
party with respect to proceedings or claims initiated by the indemnified party
and not by way of defense, except with respect to proceedings specifically
authorized by the Board of Directors or brought to enforce a right to
indemnification under the indemnification agreement, the Registrant's Bylaws or
any statute or law. Under the agreements, the Registrant is not obligated to
indemnify the indemnified party (i) for any expenses incurred by the indemnified
party with respect to any proceeding instituted by the indemnified party to
enforce or interpret the agreement, if a court of competent jurisdiction
determines that each of the material assertions made by the indemnified party in
such proceeding was not made in good faith or was frivolous; (ii) for any
amounts paid in settlement of a proceeding unless the Registrant consents to
such settlement; (iii) on account of any suit in which judgment is rendered
against the indemnified party for an accounting of profits made from the
purchase or sale by the indemnified party of securities of the Registrant
pursuant to the provisions of Section 16(b) of the Securities Exchange Act of
1934 and related laws; or (iv) if a final decision by a court having
jurisdiction in the matter shall determine that such indemnification is not
lawful.
The indemnification provisions in the Bylaws and the indemnification
agreements entered into between the Registrant and its directors and officers
may be sufficiently broad to permit indemnification of the Registrant's
directors and officers for liabilities arising under the Securities Act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
-----------------------------------
Not applicable.
ITEM 8. EXHIBITS.
--------
Exhibit
Number Description
- ------------------- ---------------------------------------------------------
4.1(1) Preferred Shares Rights Agreement
4.2(2) Registrant's Employee Qualified Stock
Purchase Plan, as amended
4.3(2) Registrant's 1996 Stock Plan
4.4(2) Registrant's 1990 Directors' Option Plan,
as amended
4.5 Teleos Research 1996 Stock Plan
II-2
5.1 Opinion of counsel as to legality of
securities being registered
24.1 Consent of Independent Auditors
24.2 Consent of Counsel (contained in Exhibit
5.1)
25.1 Power of Attorney (see Page II-4 of
Registration Statement)
- -------------------
(1) Incorporated by reference to the Registrant's Report on Form 8-A filed
January 5, 1996, as amended on January 8, 1996.
(2) Incorporated by reference to the Registrant's Annual Report on Form 10-K
for the fiscal year ended January 31, 1996.
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.
B. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (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 hereunder, 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.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Rafael, State of California, on this 22nd day of
July, 1996.
AUTODESK, INC.
By: /s/ CAROL A. BARTZ
____________________________
Carol A. Bartz, President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Carol A. Bartz and Eric B. Herr, jointly
and severally his or her attorneys-in-fact, each with the power of substitution,
for him or her 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 said attorney-in-fact, or
their 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.
Signature Title Date
_____________________________ ________________________________ _____________
/s/ CAROL A. BARTZ Chairman of the Board, President July 22, 1996
_____________________________ and Chief Executive Officer
(Carol A. Bartz) (Principal Executive Officer)
/s/ ERIC B. HERR Vice President and Chief July 22, 1996
_____________________________ Financial Officer (Principal
(Eric B. Herr) Financial and Accounting Officer)
/s/ J. HALLAM DAWSON Director July 22, 1996
_____________________________
(J. Hallam Dawson)
/s/ JERRE STEAD Director July 22, 1996
_____________________________
(Jerre Stead)
/s/ MARY ALICE TAYLOR Director July 22, 1996
_____________________________
(Mary Alice Taylor)
/s/ MARK A. BERTELSEN Director July 22, 1996
_____________________________
(Mark A. Bertelsen)
/s/ CRAWFORD W. BEVERIDGE Director July 22, 1996
_____________________________
(Crawford W. Beveridge)
/s/ MORTON TOPFER Director July 22, 1996
_____________________________
(Morton Topfer)
II-4
Index to Exhibits
Sequentially
Exhibit Numbered
Number Description Page
__________ ___________________________________ ______________
4.1(1) Preferred Shares Rights Agreement
4.2(2) Employee Qualified Stock Purchase Plan
4.3(2) 1996 Stock Plan
4.4(2) 1990 Directors' Option Plan
4.5 Teleos Research 1996 Stock Plan
5.1 Opinion of counsel as to legality of
securities being registered
24.1 Consent of Independent Auditors
24.2 Consent of Counsel (contained in
Exhibit 5.1)
25.1 Power of Attorney (see Page II-4 of
Registration Statement)
__________
(1) Incorporated by reference to the Registrant's Report on Form 8-A filed
January 5, 1996, as amended January 8, 1996.
(2) Incorporated by reference to the Registrant's Annual Report on Form 10-K
for the fiscal year ended January 31, 1996.
EXHIBIT 4.5
TELEOS RESEARCH
1996 STOCK PLAN
1. Purposes of the Plan. The purposes of this Plan are:
--------------------
. to attract and retain the best available personnel for positions of
substantial responsibility,
. to provide additional incentive to Employees and Consultants, 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. Stock Purchase Rights and Long-Term Performance Awards 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 as shall
-------------
be administering the Plan, in accordance with Section 4 of the Plan.
(b) "Applicable Laws" means the legal requirements relating to the
---------------
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code and the applicable laws of any
foreign country or jurisdiction where Options or Stock Purchase Rights will be
or are being granted under the Plan.
(c) "Board" means the Board of Directors of the Company.
-----
(d) "Cause" shall mean (i) any act of personal dishonesty taken by an
-----
Optionee in connection with Optionee's responsibilities as an employee and
intended to result in substantial personal enrichment of an Optionee, (ii) the
conviction of a felony, (iii) a willful act by an Optionee which constitutes
gross misconduct and which is injurious to the Company, and (iv) following
delivery to an Optionee of a written demand for performance from the Company
which describes the basis for the Company's belief an Optionee has not
substantially performed Optionee's duties, continued violations by an Optionee
of an Optionee's obligations to the Company which are demonstrably willful and
deliberate on the Optionee's part.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
----
(f) "Committee" means a Committee appointed by the Board in
---------
accordance with Section 4 of the Plan.
(g) "Common Stock" means the Common Stock of the Company.
------------
(h) "Company" means Teleos Research, a California corporation.
-------
(i) "Consultant" means any person, including an advisor, engaged by
----------
the Company or a Parent or Subsidiary to render services and who is compensated
for such services. The term "Consultant" shall not include Directors who are
paid only a director's fee by the Company or who are not compensated by the
Company for their services as Directors.
(j) "Continuous Status as an Employee or Consultant" means that the
----------------------------------------------
employment or consulting relationship with the Company, 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
ninety days, unless reemployment upon expiration of such leave is guaranteed by
statute or contract. If reemployment upon expiration of a leave of absence
approved by the Company is not so guaranteed, on the 181st 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.
(k) "Director" means a member of the Board.
--------
(l) "Disability" means total and permanent disability as defined in
----------
Section 22(e)(3) of the Code.
(m) "Employee" means any person, including Officers and Directors,
--------
employed by the Company or any Parent or Subsidiary of the Company. Neither
service as a Director nor payment of a director's fee by the Company shall be
sufficient to constitute "employment" by the Company.
(n) "Exchange Act" means the Securities Exchange Act of 1934, as
------------
amended.
(o) "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 Nasdaq
National Market or The Nasdaq SmallCap 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 date of such determination, as reported in The Wall Street Journal or such
-----------------------
other source as the Administrator deems reliable;
2
(ii) If the Common Stock is 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 Administrator deems reliable;
- -------------------
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.
(p) "Incentive Stock Option" means an Option intended to qualify as an
----------------------
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.
(q) "Long-Term Performance Award" means an award of cash or stock
---------------------------
pursuant to Section 12 of the Plan.
(r) "Nonstatutory Stock Option" means an Option not intended to
-------------------------
qualify as an Incentive Stock Option.
(s) "Notice of Grant" means a written or electronic notice evidencing
---------------
certain terms and conditions of an individual Option or Stock Purchase Right
grant. The Notice of Grant is part of the Option Agreement.
(t) "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.
(u) "Option" means a stock option granted pursuant to the Plan.
------
(v) "Option Agreement" means a written agreement between the Company
----------------
and an Optionee evidencing the terms and conditions of an individual Option
grant. The Option Agreement is subject to the terms and conditions of the Plan.
(w) "Optioned Stock" means the Common Stock subject to an Option or
--------------
Stock Purchase Right.
(x) "Optionee" means an Employee or Consultant who holds an
--------
outstanding Option or Stock Purchase Right.
(y) "Parent" means a "parent corporation", whether now or hereafter
------
existing, as defined in Section 424(e) of the Code.
(z) "Plan" means this 1996 Stock Plan.
----
3
(aa) "Restricted Stock" means shares of Common Stock acquired pursuant
----------------
to a grant of Stock Purchase Rights under Section 11 below.
(bb) "Restricted Stock Purchase Agreement" means a written agreement
-----------------------------------
between the Company and the Optionee evidencing the terms and restrictions
applying to stock purchased under a Stock Purchase Right. The Restricted Stock
Purchase Agreement is subject to the terms and conditions of the Plan and the
Notice of Grant.
(cc) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any
----------
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
(dd) "Section 16(b)" means Section 16(b) of the Securities Exchange
-------------
Act of 1934, as amended.
(ee) "Share" means a share of the Common Stock, as adjusted in
-----
accordance with Section 14 of the Plan.
(ff) "Stock Purchase Right" means the right to purchase Common Stock
--------------------
pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant.
(gg) "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 14 of
-------------------------
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 100,000 Shares. The Shares may be authorized, but unissued,
or reacquired Common Stock.
If an Option or Stock Purchase Right 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); provided, however, that Shares that have actually been
-------- -------
issued under the Plan, whether upon exercise of 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) Procedure.
---------
(i) Multiple Administrative Bodies. If permitted by Rule
------------------------------
16b-3, the Plan may be administered by different bodies with respect to
Directors, Officers who are not Directors, and Employees who are neither
Directors nor Officers.
4
(ii) Administration With Respect to Directors and Officers
-----------------------------------------------------
Subject to Section 16(b). With respect to Option or Stock Purchase Right
- ------------------------
grants made to Employees who are also Officers or Directors subject to Section
16(b) of the Exchange Act, the Plan shall be administered by (A) the Board, if
the Board may administer the Plan in a manner complying with the rules under
Rule 16b-3 relating to the disinterested administration of employee benefit
plans under which Section 16(b) exempt discretionary grants and awards of equity
securities are to be made, or (B) a committee designated by the Board to
administer the Plan, which committee shall be constituted to comply with the
rules under Rule 16b-3 relating to the disinterested administration of employee
benefit plans under which Section 16(b) exempt discretionary grants and awards
of equity securities are to be made. Once appointed, such Committee shall
continue to serve in its designated capacity until otherwise directed by the
Board. From time to time the Board may increase the size of the Committee and
appoint additional members, remove members (with or without cause) and
substitute new members, fill vacancies (however caused), and remove all members
of the Committee and thereafter directly administer the Plan, all to the extent
permitted by the rules under Rule 16b-3 relating to the disinterested
administration of employee benefit plans under which Section 16(b) exempt
discretionary grants and awards of equity securities are to be made.
(iii) Administration With Respect to Other Persons. With
--------------------------------------------
respect to Option or Stock Purchase Right grants made to Employees or
Consultants who are neither Directors nor Officers of the Company, the Plan
shall be administered by (A) the Board or (B) a committee designated by the
Board, which committee shall be constituted to satisfy Applicable Laws. Once
appointed, such Committee shall serve in its designated capacity until otherwise
directed by the Board. The Board may increase the size of the Committee and
appoint additional members, remove members (with or without cause) and
substitute new members, fill vacancies (however caused), and remove all members
of the Committee and thereafter directly administer the Plan, all to the extent
permitted by Applicable Laws.
(b) Powers of the Administrator. Subject to the provisions of the
---------------------------
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, 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(o) of the Plan;
(ii) to select the Consultants and Employees to whom Options and
Stock Purchase Rights may 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 of Common Stock to be
covered by each Option and Stock Purchase Right granted hereunder;
5
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any award granted hereunder. Such terms and
conditions include, but are not limited to, the exercise price, the time or
times when Options or Stock Purchase Rights may be exercised (which may be based
on performance criteria), any vesting acceleration or waiver of forfeiture
restrictions, and any restriction or limitation regarding any Option or Stock
Purchase Right or the shares of Common Stock relating thereto, based in each
case on such factors as the Administrator, in its sole discretion, shall
determine;
(vii) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;
(viii) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;
(ix) to modify or amend each Option or Stock Purchase Right
(subject to Section 16(c) of the Plan), including the discretionary authority to
extend the post-termination exercisability period of Options longer than is
otherwise provided for in the Plan;
(x) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of an Option or Stock Purchase Right
previously granted by the Administrator;
(xi) to determine the terms and restrictions applicable to
Options and Stock Purchase Rights and any Restricted Stock; and
(xii) to make all other determinations deemed necessary or
advisable for administering the Plan.
(c) Effect of Administrator's Decision. The Administrator's
----------------------------------
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options or Stock Purchase Rights.
5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may
-----------
be granted to Employees and Consultants. Incentive Stock Options may be granted
only to Employees. If otherwise eligible, an Employee or Consultant who has
been granted an Option or Stock Purchase Right may be granted additional Options
or Stock Purchase Rights.
6. Limitations.
-----------
(a) Each Option shall be designated in the written option agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with
6
respect to which Incentive Stock Options are exercisable for the first time by
the Optionee during any calendar year (under all plans of the Company and any
Parent or Subsidiary) exceeds $100,000, such Options shall be treated as
Nonstatutory Stock Options.
(b) Neither the Plan nor any Option or Stock Purchase Right shall
confer upon an Optionee any right with respect to continuing the Optionee's
employment or consulting relationship with the Company, nor shall they interfere
in any way with the Optionee's right or the Company's right to terminate such
employment or consulting relationship at any time, with or without cause.
(c) The following limitations shall apply to grants of Options to
Employees:
(i) No Employee shall be granted, in any fiscal year of the
Company, Options to purchase more than 50,000 Shares.
(ii) In connection with his or her initial employment, an
Employee may be granted Options to purchase up to an additional 30,000 Shares
which shall not count against the limit set forth in subsection (i) above.
(iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company's capitalization as described in
Section 14.
(iv) If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 14), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above.
7. Term of Plan. Subject to Section 20 of the Plan, the Plan shall
------------
become effective upon the earlier to occur of its adoption by the Board or its
approval by the shareholders of the Company as described in Section 20 of the
Plan. It shall continue in effect for a term of ten (10) years unless
terminated earlier under Section 16 of the Plan.
8. Term of Option. The term of each Option shall be stated in the Notice
--------------
of Grant; provided, however, that in the case of an Incentive Stock Option, the
-------- -------
term shall be ten (10) years from the date of grant or such shorter term as may
be provided in the Notice of Grant.
9. Option Exercise Price and Consideration.
---------------------------------------
(a) Exercise Price. The per share exercise price for the Shares to be
--------------
issued pursuant to exercise of an Option shall be no less than 100% of the Fair
Market Value per Share on the date of grant.
7
(b) Waiting Period and Exercise Dates. At the time an Option is
---------------------------------
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised. In so doing, the Administrator may specify that an
Option may not be exercised until either the completion of a service period or
the achievement of performance criteria with respect to the Company or the
Optionee.
(c) Form of Consideration. The Administrator shall determine the
---------------------
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:
(i) cash;
(ii) check;
(iii) promissory note;
(iv) other Shares which (A) 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 (B) 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;
(v) delivery of a properly executed exercise notice together with
such other documentation as the Administrator 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;
(vi) a reduction in the amount of any Company liability to the
Optionee, including any liability attributable to the Optionee's participation
in any Company-sponsored deferred compensation program or arrangement;
(vii) any combination of the foregoing methods of payment; or
(viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.
10. Exercise of Option.
------------------
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
-----------------------------------------------
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement.
An Option may not be exercised for a fraction of a Share.
8
An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the stock certificate evidencing such Shares is issued (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company), no right to vote or 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 after the Option is exercised. No
adjustment will 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 14 of the Plan.
Exercising an Option in any manner shall decrease the number of Shares
thereafter 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. Upon
----------------------------------------------------
termination of an Optionee's Continuous Status as an Employee or Consultant,
other than upon the Optionee's death or Disability, the Optionee may exercise
his or her Option within such period of time as is specified in the Notice of
Grant to the extent that he or she is entitled to exercise it on the date of
termination (but in no event later than the expiration of the term of such
Option as set forth in the Notice of Grant). In the absence of a specified time
in the Notice of Grant, the Option shall remain exercisable for three (3) months
following the Optionee's termination. If, on the date of termination, the
Optionee is not entitled to exercise his or her entire Option, the Shares
covered by the unexercisable portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
Notwithstanding the above, in the event of an Optionee's change in
status from Consultant to Employee or Employee to Consultant, the Optionee's
Continuous Status as an Employee or Consultant shall not automatically terminate
solely as a result of such change in status. In such event, an 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
three months and one day following such change of status.
(c) Disability of Optionee. Upon termination of an Optionee's
----------------------
Continuous Status as an Employee or Consultant as a result of the Optionee's
Disability, the Optionee may exercise his or her Option at any time within
twelve (12) months (or such other period of time as is determined by the
Administrator) from the date of termination, but only to the extent that the
Optionee is entitled to exercise it on the date of termination (and in no event
later than the expiration of the term of the Option as set forth in the Notice
of Grant). If, on
9
the date of termination, the Optionee is not entitled to exercise his or her
entire Option, the Shares covered by the unexercisable portion of the Option
shall revert to the Plan. If, after termination, the Optionee does not exercise
his or her Option 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 shall become fully exercisable, including as to Shares for which it would
not otherwise be exercisable and may be exercised at any time within twelve (12)
months (or such other period of time as is determined by the Administrator)
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. If, after death, the Optionee's estate or a person who acquired
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) Rule 16b-3. Options granted to individuals subject to Section 16
----------
of the Exchange Act ("Insiders") must comply with the applicable provisions of
Rule 16b-3 and shall contain such additional conditions or restrictions as may
be required thereunder to qualify for the maximum exemption from Section 16 of
the Exchange Act with respect to Plan transactions.
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 or electronically, by means of a Notice of Grant, of the
terms, conditions and restrictions related to the offer, including the number of
Shares that the offeree shall be entitled to purchase, the price to be paid
provided, however, that the purchase price shall not be less than the par value
- -------- -------
of the Company's Common Stock, and the time within which the offeree must accept
such offer, which shall in no event exceed ninety (90) days from the later of
(i) the date upon which the Administrator made the determination to grant the
Stock Purchase Right, or (ii) the date the Notice of Grant of Stock Purchase
Rights is delivered to the Executive. The offer shall be accepted by execution
of a Restricted Stock Purchase Agreement in the form determined by the
Administrator. The number of Shares subject to grants of Stock Purchase Rights
shall not exceed fifteen percent (15%) of the total number of Shares authorized
under the Plan.
(b) Repurchase Option. 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 repurchase option shall lapse at a
rate determined by the Administrator; provided, however that, except as
-------- -------
otherwise provided in this subsection, no portion of the
10
repurchase option shall lapse before the end of three (3) years from the date of
purchase of the Restricted Stock. 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.
(c) Rule 16b-3. Stock Purchase Rights granted to Insiders, and Shares
----------
purchased by Insiders in connection with Stock Purchase Rights, shall be subject
to any restrictions applicable thereto in compliance with Rule 16b-3. An
Insider may only purchase Shares pursuant to the grant of a Stock Purchase
Right, and may only sell Shares purchased pursuant to the grant of a Stock
Purchase Right, during such time or times as are permitted by Rule 16b-3.
(d) 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.
(e) Rights as a Shareholder. Once the Stock Purchase Right is
-----------------------
exercised, the purchaser shall have the 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
will 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 14
of the Plan.
(f) Issuance of Shares. As soon as possible after full payment of the
------------------
purchase price, the Shares purchased shall be duly issued; provided, however,
-------- -------
that the Administrator may require that the purchaser make adequate provision
for any Federal and State withholding obligations of the Company as a condition
to such purchase.
(g) Shares Available Under the Plan. Exercise of a Stock Purchase
-------------------------------
Right in any manner shall result in a decrease in the number of Shares that
thereafter shall be available for reissuance under the Plan.
(h) Stock Withholding to Satisfy Tax Obligations. The Administrator
--------------------------------------------
may, in its discretion, permit a purchaser to satisfy any withholding tax
obligation that arises in connection with the vesting of Shares by electing to
have the Company withhold from such vested Shares that number of Shares having a
Fair Market Value equal to the amount required to be withheld. Elections by
purchasers to have Shares withheld for this purpose shall be made in writing in
a form acceptable to the Administrator and shall be subject to such restrictions
and limitations as the Administrator may specify.
12. Long-Term Performance Awards.
----------------------------
(a) Awards. Long-Term Performance Awards are cash or stock bonus
------
awards that may be granted either along with, in addition to or in tandem with
other awards
11
granted under the Plan and/or awards made outside of the Plan. Long-Term
Performance Awards shall not require payment by the recipient of any
consideration for the Long-Term Performance Award or for the Shares covered by
such award. The Administrator shall determine the nature, length and starting
date of any performance period (the "Performance Period") for each Long-Term
Performance Award and shall determine the performance and/or employment factors
to be used in the determination of the value of Long-Term Performance Awards and
the extent to which such Long-Term Performance Awards have been earned. Shares
issued pursuant to a Long-Term Performance Award may be made subject to various
conditions, including vesting or forfeiture provisions. Long-Term Performance
Awards may vary from participant to participant and between groups of
participants and shall be based upon the achievement of Company, Subsidiary
and/or individual performance factors or upon such other criteria as the
Administrator may deem appropriate. Performance Periods may overlap and
participants may participate simultaneously with respect to Long-Term
Performance Awards that are subject to different Performance Periods and
different performance factors and criteria. Long-Term Performance Awards shall
be confirmed by, and be subject to the terms of, a written Long-Term Performance
Award agreement.
(b) Value of Awards. At the beginning of each Performance Period, the
---------------
Administrator may determine for each Long-Term Performance Award subject to such
Performance Period the range of dollar values and/or numbers of Shares to be
issued to the participant at the end of the Performance Period if and to the
extent that the relevant measures of performance for such Long-Term Performance
Award are met. Such dollar values or numbers of Shares may be fixed or may vary
in accordance with such performance or other criteria as may be determined by
the Administrator.
(c) Adjustment of Awards. Notwithstanding the provisions of Section
--------------------
16 hereof, the Administrator may, after the grant of Long-Term Performance
Awards, adjust the performance factors applicable to such Long-Term Performance
Awards to take into account changes in the law or in accounting or tax rules and
to make such adjustments as the Administrator deems necessary or appropriate to
reflect the inclusion or exclusion of the impact of extraordinary or unusual
items, events or circumstances in order to avoid windfalls or hardships.
(d) Termination. Unless otherwise provided in the applicable Long-
-----------
Term Performance Award agreement, if a participant terminates his or her
employment or his or her consultancy during a Performance Period because of
death or Disability, the Administrator may in its discretion provide for an
earlier payment in settlement of such award, which payment may be in such amount
and under such terms and conditions as the Administrator deems appropriate.
Unless otherwise provided in the applicable Long-Term Performance
Award agreement, if a participant terminates employment or his or her
consultancy during a Performance Period for any reason other than death or
Disability, then such a participant shall not be entitled to any payment with
respect to the Long-Term Performance Award subject to
12
such Performance Period, unless the Administrator shall otherwise determine in
its discretion.
(e) Form of Payment. The earned portion of a Long-Term Performance
---------------
Award may be paid currently or on a deferred basis (with such interest or
earnings equivalent as may be determined by the Administrator). Payment shall
be made in the form of cash or whole Shares (including Restricted Stock), or a
combination thereof, either in a lump sum payment or in installments, all as the
Administrator shall determine.
(f) Reservation of Shares. In the event that the Administrator grants
---------------------
a Long-Term Performance Award that is payable in cash or Common Stock, the
Administrator may (but need not) reserve an appropriate number of Shares under
the Plan at the time of grant of the Long-Term Performance Award. If and to the
extent that the full amount reserved is not actually paid in Common Stock, the
Shares representing the portion of the reserve for that Long-Term Performance
Award that is not actually issued in satisfaction of such Long-Term Performance
Award shall again become available for award under the Plan. If Shares are not
reserved by the Administrator at the time of grant, then (i) no Shares shall be
deducted from the number of Shares available for grant under the Plan at that
time and (ii) at the time of payment of the Long-Term Performance Award, only
the number of Shares actually issued to the participant shall be so deducted.
If there are not a sufficient number of Shares available under the Plan for
issuance to a participant at the time of payment of a Long-Term Performance
Award, any shortfall shall be paid by the Company in cash.
(g) Rule 16b-3. Grants of Long-Term Performance Awards to Directors
----------
and Officers must comply with the applicable provisions of Rule 16b-3 and such
Long-Term Performance Awards shall contain such additional conditions or
restrictions, if any, as may be required by Rule 16b-3 to be in the written
agreement relating to such Long-Term Performance Awards in order to qualify for
the maximum exemption from Section 16 of the Exchange Act with respect to Plan
transactions.
13. Non-Transferability of Options and Stock Purchase Rights. An Option
--------------------------------------------------------
or Stock Purchase Right 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.
14. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
------------------------------------------------------------------
Asset Sale.
- ----------
(a) Changes in Capitalization. Subject to any required action by the
-------------------------
shareholders of the Company, the number of Shares covered by each outstanding
Option, Long-Term Performance Award and Stock Purchase Right, and the number of
Shares which have been authorized for issuance under the Plan but as to which no
Options, Long-Term Performance Awards or Stock Purchase Rights have yet been
granted or which have been returned to the Plan upon cancellation or expiration
of an Option, Long-Term Performance Award or Stock Purchase Right, as well as
the price per Share covered by each such
13
outstanding Option, Long-Term Performance Award or Stock Purchase Right, 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." 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 subject to an Option, Long-Term Performance Award
or Stock Purchase Right.
(b) Dissolution or Liquidation. In the event of the proposed
--------------------------
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option or Stock Purchase Right until ten
(10) days prior to such transaction as to all of the Optioned Stock covered
thereby, including Shares as to which the Option would not otherwise be
exercisable. In addition, the Administrator may provide that any Company
repurchase option applicable to any Shares purchased upon exercise of an Option
or Stock Purchase Right shall lapse as to all such Shares, provided the proposed
--------
dissolution or liquidation takes place at the time and in the manner
contemplated. To the extent it has not been previously exercised, an Option or
Stock Purchase Right will 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 substantially all of the assets
of the Company, each outstanding Option and Stock Purchase Right shall be
assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation, or in the
event that the successor corporation refuses to assume or substitute for the
Option or Stock Purchase Right, the Optionee shall have the right to exercise
the Option or Stock Purchase Right as to all of the Optioned Stock, including
Shares as to which it would not otherwise be exercisable. If an Option or Stock
Purchase Right is exercisable in lieu of assumption or substitution in the event
of a merger or sale of assets, the Administrator shall notify the Optionee in
writing or electronically that the Option or Stock Purchase Right shall be fully
exercisable for a period of fifteen (15) days from the date of such notice, and
the Option or Stock Purchase Right 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 sale of assets, the
option or 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 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
14
majority of the outstanding Shares); provided, however, that if such
-------- -------
consideration received in the merger or sale of assets was 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 sale of assets.
15. Date of Grant. The date of grant of an Option or Stock Purchase Right
-------------
shall be, for all purposes, the date on which the Administrator makes the
determination granting such Option or Stock Purchase Right, or such other later
date as is determined by the Administrator. Notice of the determination shall
be provided to each Optionee within a reasonable time after the date of such
grant.
16. Amendment and Termination of the Plan.
-------------------------------------
(a) Amendment and Termination. The Board may at any time amend,
-------------------------
alter, suspend or terminate the Plan.
(b) Shareholder Approval. The Company shall obtain shareholder
--------------------
approval of any Plan amendment to the extent necessary and desirable to comply
with Rule 16b-3 or with Sections 162(m) or 422 of the Code (or any successor
rule or statute or other applicable law, rule or regulation, including the
requirements of any exchange or quotation system on which the Common Stock is
listed or quoted). Such shareholder approval, if required, shall be obtained in
such a manner and to such a degree as is required by the applicable law, rule or
regulation.
(c) Effect of Amendment or Termination. No amendment, alteration,
----------------------------------
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
17. Conditions Upon Issuance of Shares.
----------------------------------
(a) Legal Compliance. 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 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, Applicable Laws, and the requirements of any stock
exchange or quotation system upon which the Shares may then be listed or quoted,
and shall be further subject to the approval of counsel for the Company with
respect to such compliance.
(b) Investment Representations. As a condition to the exercise of an
--------------------------
Option or Stock Purchase Right, the Company may require the person exercising
such Option
15
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.
18. Liability of Company.
--------------------
(a) Inability to Obtain Authority. 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.
(b) Grants Exceeding Allotted Shares. If the Optioned Stock covered
--------------------------------
by an Option or Stock Purchase Right exceeds, as of the date of grant, the
number of Shares which may be issued under the Plan without additional
shareholder approval, such Option or Stock Purchase Right shall be void with
respect to such excess Optioned Stock, unless shareholder approval of an
amendment sufficiently increasing the number of Shares subject to the Plan is
timely obtained in accordance with Section 16(b) of the Plan.
19. 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.
20. 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 manner and to the degree required under applicable federal and state law.
16
TELEOS RESEARCH
NOTICE OF GRANT OF STOCK OPTIONS
[Optionee's Name and Address]
You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:
Grant Number _________________________________
Date of Grant _________________________________
Vesting Commencement Date _________________________________
Exercise Price per Share _________________________________
Total Number of Shares Granted _________________________________
Total Exercise Price _________________________________
Type of Option: ___ Incentive Stock Option
___ Nonstatutory Stock Option
Term/Expiration Date: _________________________________
Vesting Schedule:
- ----------------
This Option may be exercised, in whole or in part, in accordance with the
following schedule:
30% of the Shares subject to the Option shall vest twelve months after the
Vesting Commencement Date, 30% of the Shares subject to the Option shall vest
twenty-four months after the Vesting Commencement Date, and the remaining 40% of
the Shares subject to the Option shall vest thirty-six months after the Vesting
Commencement Date.
TELEOS RESEARCH
STOCK OPTION AGREEMENT
Teleos Research, a California corporation (the "Company"), has granted to
the optionee (the "Optionee") named on the Notice of Grant of Stock Options (the
"Notice of Grant") which is attached hereto an option to purchase that number of
shares of Common Stock (the "Shares") set forth on the Notice of Grant at the
price set forth on the Notice of Grant and in all respects subject to the terms,
definitions and provisions of the 1996 Stock Option Plan (the "Plan") adopted by
the Company which is incorporated herein by reference. The terms defined in the
Plan shall have the same defined meanings herein.
1. Nature of the Option. If designated an Incentive Stock Option, this
--------------------
Option is intended to qualify as an Incentive Stock Option as defined in Section
422 of the Code.
2. Exercise of Option. This Option shall be exercisable during its term
------------------
in accordance with the provisions of Section 9 of the Plan as follows:
(i) Right to Exercise.
-----------------
(a) Subject to subsections 2(i)(b) and (c) below, this Option
shall vest over the period and at the rate set forth on the Notice of Grant.
(b) This Option may not exercised for a fraction of a share.
(c) In the event of Optionee's death, disability or other
termination of employment, the exercisability of the Option is governed by
Sections 7, 8 and 9 below.
(ii) Method of Exercise. This Option shall be exercisable by written
------------------
notice which shall state the election to exercise the Option, the number of
Shares in respect of which the Option is being exercised, and such other
representations and agreements as to the holder's investment intent with respect
to such shares of Common Stock as may be required by the Company pursuant to the
provisions of the Plan. Such written notice shall be signed by the Optionee and
shall be delivered in person or by certified mail to the Secretary of the
Company. The written notice shall be accompanied by payment of the exercise
price. This Option shall be deemed to be exercised upon receipt by the Company
of such written notice accompanied by the exercise price.
No Shares will be issued pursuant to the exercise of an Option unless such
issuance and such exercise shall comply with all relevant provisions of law and
the requirements of any stock exchange upon which the Shares may then be listed.
Assuming such compliance, the Shares shall be considered transferred to the
Optionee on the date on which the Option is exercised with respect to such
Shares.
3. Optionee's Representations. In the event the Shares purchasable
--------------------------
pursuant to the exercise of this Option have not been registered under the
Securities Act of 1933, as amended, at the time this Option is exercised,
Optionee shall, concurrently with the exercise of all or any
18
portion of this Option, deliver to the Company an Investment Representation
Statement in the form provided by the Company.
4. Method of Payment. Payment of the exercise price shall be by (i)
-----------------
cash, (ii) check, (iii) surrender of other shares of Common Stock of the Company
which either have been owned by the Optionee for more than six months on the
date of surrender or were not acquired, directly or indirectly, from the Company
and have a fair market value on the date of surrender equal to the exercise
price of the Shares as to which the Option is being exercised or (iv) delivery
of a properly executed exercise notice together with irrevocable instructions to
an agent of the Company to sell the Shares and promptly deliver to the Company
that portion of the sale or loan proceeds required to pay the exercise price.
5. Restrictions on Exercise. This Option may not be exercised until such
------------------------
time as the Plan has been approved by the shareholders of the Company, or if the
issuance of such Shares upon such exercise or the method of payment of
consideration for such Shares would constitute a violation of any applicable
federal or state securities or other law or regulation, including any rule under
Part 207 of Title 12 of the Code of Federal Regulations ("Regulation G") as
promulgated by the Federal Reserve Board. As a condition to the exercise of
this Option, the Company may require Optionee to make any representation and
warranty to the Company as may be required by any applicable law or regulation.
6. Termination of Status as an Employee. If Optionee ceases to serve as
------------------------------------
an Employee, he may, but only within three (3) months after the date he ceases
to be an Employee of the Company, exercise this Option to the extent that he was
entitled to exercise it at the date of such termination. To the extent that he
was not entitled to exercise this Option at the date of such termination, or if
he does not exercise this Option within the time specified herein, the Option
shall terminate.
7. Disability of Optionee. Notwithstanding the provisions of Section 6
----------------------
above, if Optionee is unable to continue his employment with the Company as a
result of his total and permanent disability (as defined in Section 22(e)(3) of
the Code), he may, but only within twelve (12) months from the date of
termination of employment, exercise his Option to the extent he was entitled to
exercise it at the date of such termination. To the extent that he was not
entitled to exercise the Option at the date of termination, or if he does not
exercise such Option (which he was entitled to exercise) within the time
specified herein, the Option shall terminate.
8. Death of Optionee. In the event of the death of Optionee during the
-----------------
term of this Option and while an Employee of the Company and having been in
Continuous Status as an Employee since the date of grant of the Option, the
Option may be exercised, at any time within twelve (12) months following the
date of death, by Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent of the
right to exercise that had accrued at the date of death.
9. Non-Transferability of Option. This Option may not be transferred in
-----------------------------
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the
19
lifetime of Optionee only by him. The terms of this Option shall be binding upon
the executors, administrators, heirs, successors and assigns of the Optionee.
10. Term of Option. This Option may be exercised only within the term set
--------------
out on the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option.
11. Tax Consequences. Some of the federal and state tax consequences
----------------
relating to this Option, as of the date of this Option, are set forth below.
THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE
SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING
THIS OPTION OR DISPOSING OF THE SHARES.
(i) Exercising the Option.
---------------------
(a) Nonstatutory Stock Option. The Optionee may incur regular
-------------------------
federal income tax and state income tax liability upon exercise of a
nonstatutory stock option (an "NSO"). The Optionee will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to the
excess, if any, of the Fair Market Value of the Exercised Shares on the date of
exercise over their aggregate Exercise Price. If the Optionee is an Employee or
a former Employee, the Company will be required to withhold from his or her
compensation or collect from Optionee and pay to the applicable taxing
authorities an amount in cash equal to a percentage of this compensation income
at the time of exercise, and may refuse to honor the exercise and refuse to
deliver Shares if such withholding amounts are not delivered at the time of
exercise.
(b) Incentive Stock Option. If this Option qualifies as an
----------------------
incentive stock option (an "ISO"), the Optionee will have no regular federal
income tax or state income tax liability upon its exercise, although the excess,
if any, of the Fair Market Value of the Exercised Shares on the date of exercise
over their aggregate Exercise Price will be treated as an adjustment to
alternative minimum taxable income for federal tax purposes and may subject the
Optionee to alternative minimum tax in the year of exercise. In the event that
the Optionee undergoes a change of status from Employee to Consultant, any
Incentive Stock Option of the Optionee that remains unexercised shall cease to
qualify as an Incentive Stock Option and will be treated for tax purposes as a
Nonstatutory Stock Option on the ninety-first (91st) day following such change
of status.
(ii) Disposition of Shares.
---------------------
(a) NSO. If the Optionee holds NSO Shares for at least one year,
---
any gain realized on disposition of the Shares will be treated as long-term
capital gain for federal income tax purposes.
(b) ISO. If the Optionee holds ISO Shares for at least one (1)
---
year after exercise and two (2) years after the grant date, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
income tax purposes. If the Optionee
20
disposes of ISO Shares within one (1) year after exercise or two (2) years after
the grant date, any gain realized on such disposition will be treated as
compensation income (taxable at ordinary income rates) to the extent of the
excess, if any, of the lesser of (A) the difference between the Fair Market
Value of the Shares acquired on the date of exercise and the aggregate Exercise
Price, or (B) the difference between the sale price of such Shares and the
aggregate Exercise Price.
(iii) Notice of Disqualifying Disposition of ISO Shares. If the
-------------------------------------------------
Optionee sells or otherwise disposes of any of the Shares acquired pursuant to
an ISO on or before the later of (i) two (2) years after the grant date, or (ii)
one (1) year after the exercise date, the Optionee shall immediately notify the
Company in writing of such disposition. The Optionee agrees that he or she may
be subject to income tax withholding by the Company on the compensation income
recognized from such early disposition of ISO Shares by payment in cash or out
of the current earnings paid to the Optionee.
12. Entire Agreement; Governing Law. The Plan is incorporated herein by
-------------------------------
reference. The Plan and this Option Agreement constitute the entire agreement
of the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by California law except for that body of
law pertaining to conflict of laws.
13. NO GUARANTEE OF EMPLOYMENT. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE
--------------------------
VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY
CONTINUING SERVICE AS AN EMPLOYEE OR CONSULTANT AT THE WILL OF THE COMPANY (AND
NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS AN
EMPLOYEE OR CONSULTANT FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND
SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S EMPLOYMENT OR CONSULTING RELATIONSHIP AT ANY TIME, WITH OR WITHOUT
CAUSE.
By your signature and the signature of the Company's representative below,
you and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations
21
of the Administrator upon any questions relating to the Plan and Option
Agreement. Optionee further agrees to notify the Company upon any change in the
residence address indicated below.
OPTIONEE TELEOS RESEARCH
By: _________________________ By: _________________________
Name: _______________________ Name: _______________________
Address: ____________________ Title: ______________________
22
EXHIBIT 5.1
Exhibit 5.1
July 23, 1996
Autodesk, Inc.
111 McInnis Parkway
San Rafael, California 94903
Re: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 to be filed by you
with the Securities and Exchange Commission on or about July 23, 1996 (the
"Registration Statement"), in connection with the registration under the
Securities Act of 1933, as amended, of 500,000 additional shares of your Common
Stock reserved for issuance pursuant to the Employee Qualified Stock Purchase
Plan, 200,000 additional shares under the 1990 Directors' Option Plan, 1,500,000
shares under the 1996 Stock Plan, and 100,000 shares under the Teleos Research
1996 Stock Plan (which Plans are collectively referred to herein as the "Plans"
and which shares are collectively referred to herein as the "Shares"). As your
counsel in connection with the transaction, we have examined the proceedings
taken and are familiar with the proceedings proposed to be taken by you in
connection with the sale and issuance of the Shares pursuant to the Plans.
It is our opinion that, when issued and sold in the manner referred to in the
Plans, the Shares will be legally and validly issued, fully paid and
nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the use of our name wherever appearing in the
Registration Statement and any amendment thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
EXHIBIT 24.1
EXHIBIT 24.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 333- ) pertaining to the 1996 Stock Plan, 1990 Director's
Option Plan, and Employee Qualified Stock Purchase Plan of Autodesk, Inc. and
the 1996 Stock Plan of Teleos Research of our report dated February 20, 1996,
with respect to the consolidated financial statements of Autodesk, Inc.
incorporated by reference in its Annual Report (Form 10-K) for the year ended
January 31, 1996, and the related financial statement schedule included therein,
filed with the Securities and Exchange Commission.
San Francisco, California
July 23, 1996
