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Exhibit 10.14
INFINITY FINANCIAL TECHNOLOGY, INC
1993 STOCK INCENTIVE PLAN
1. ESTABLISHMENT, PURPOSE AND DEFINITIONS.
(a) The 1993 Stock Incentive Plan (the "Plan") of INFINITY
Financial Technology, Inc., a California corporation (the "Company"), is hereby
adopted.
(b) The purpose of this Plan is to provide incentives to
employees, directors, advisors and consultants of the Company and its affiliates
(collectively, the "Participants") for increased efforts and successful
achievements on behalf of or in the interests of the Company and its affiliates
and to maximize the rewards due them for such increased efforts and successful
achievements.
(c) The Plan is intended to provide a means whereby Participants
may be given an opportunity to purchase shares of Stock (as defined in Section 3
of the Plan) of the Company pursuant to (i) options which may qualify as
incentive stock options (the "incentive stock options") under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"), or (ii) options which do
not qualify as incentive stock options (the "nonqualified stock options").
(d) The term "affiliates" as used in this Plan means parent or
subsidiary corporations, as defined in Section 424(e) and (f) of the Code (but
substituting "the Company" for "employer corporation"), including parents or
subsidiaries which become such after adoption of the Plan.
2. ADMINISTRATION OF THE PLAN.
(a) The Plan shall be administered by the Board of Directors of
the Company(the "Board"). The Board may delegate the responsibility for
administering the Plan to a committee (the "Committee"), under such terms and
conditions as the Board shall determine. If the Board does not delegate
administration of the Plan to the Committee, then each reference in this Plan to
"the Committee" shall be construed to refer solely to the Board. The Committee
shall consist of two or more members of the Board or such lesser number of
members of the Board as permitted by Rule 16b-3 promulgated under the Securities
Exchange Act of 1934, as amended ("Rule 16b-3"). From and after the date on
which the Stock is registered under Section 12(g) of the Securities Exchange Act
of 1934 (the "1934 Act Effective Date"), none of the members of the Committee
shall receive, while serving on the Committee, or with respect to any member of
the Committee appointed after the 1934 Act Effective Date, during the lesser of
(x) the one year period preceding appointment to the Committee and (y) the
period commencing on the 1934 Act Effective Date and terminating on the date of
appointment to the Committee, a grant or award of equity securities under (i)
the Plan or (ii) any other plan of the Company or its affiliates under which the
participants are entitled to acquire Stock (including restricted Stock), stock
options, stock bonuses, related rights or stock appreciation rights of the
Company or any of its affiliates, other than pursuant to transactions in any
such other plan which do not disqualify a director from being a disinterested
person under Rule 16b-3. The limitations set forth in this Section 2(a) shall
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automatically incorporate any additional requirements that may in the future be
necessary for the Plan to comply with Rule 16b-3. Members of the Committee shall
serve at the pleasure of the Board.
(b) The Committee may from time to time determine which
employees, directors, advisors or consultants of the Company or its affiliates
shall be granted options under the Plan, the terms thereof (including without
limitation determining whether the options are incentive stock options, the
times at which the options shall become exercisable, restrictions on transfer of
Stock acquired upon exercise of the options, and whether the Company shall have
rights to repurchase such Stock), and the number of shares for which an option
or options, may be granted; provided, however, that only nonqualified stock
options shall be granted to persons who are not employees of the Company or its
affiliates.
(c) If rights of the Company to repurchase Stock are imposed, (i)
the Committee may, in its sole discretion, accelerate, in whole or in part, the
time for lapsing of any such rights of the Company to repurchase of shares of
such Stock, and (ii) the certificates evidencing such shares of Stock, although
issued in the name of the Participant concerned, shall be held by the Company or
a third party designated by the Committee in escrow subject to delivery to the
Participant or to the Company at such times and in such amounts as shall be
directed by the Committee under the terms of this Plan and the Participant's
option agreement.
(d) The Committee shall have the sole authority, in its absolute
discretion, to (i) adopt, amend and rescind such rules and regulations
consistent with the provisions of the Plan as, in its opinion, may be advisable
in the administration of the Plan, (ii) construe and interpret the Plan, the
rules and regulations, and the instruments evidencing options granted under the
Plan and (iii) make all other determinations deemed necessary or advisable for
the administration of the Plan. All decisions, determinations and
interpretations of the Committee shall be binding on all Participants in the
Plan.
3. STOCK SUBJECT TO THE PLAN.
(a) Stock shall mean Common Stock of the Company reserved for
issuance under this Plan or such stock as may be changed as contemplated by
Section 3(c) below. Stock shall include shares drawn and reserved from either
the Company's authorized but unissued shares of Common Stock or from reacquired
shares of Common Stock, including without limitation shares repurchased by the
Company in the open market.
(b) Options may be granted under the Plan from time to time to
Participants to purchase an aggregate of 3,186,266 shares of Stock.
Notwithstanding the foregoing, no option shall be granted under the Plan if, at
the time of any such grant, the aggregate number of shares subject to
outstanding options and rights to purchase Stock would exceed 30% of the then
outstanding shares of the Company. Should one or more outstanding options under
this Plan expire or terminate for any reason prior to exercise in full
(including any option canceled in accordance with the cancellation-regrant
provisions of Section 6(f) of this Plan), then the shares of Stock subject to
the portion of each option not so exercised shall be available for subsequent
option grants under the Plan. Shares of Stock repurchased by the Company
pursuant to any
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repurchase right shall be available for subsequent option grants
(other than incentive stock options) under the Plan. Shares of Stock subject to
any option or portion thereof surrendered or canceled in accordance with Section
11 or 12 shall not be available for subsequent option grant under the Plan.
(c) If there shall be any change in the Stock subject to the
Plan, including Stock subject to any option granted hereunder, through merger,
consolidation, reorganization, reincorporation stock split, stock dividend or
other similar change in the corporate structure of the Company, appropriate
adjustments shall be made by the Committee in order to preserve but not to
increase the benefits to each Participant, including adjustments in the
aggregate number of shares of Stock subject to the Plan and the number of shares
of Stock and the price per share subject to outstanding options granted
hereunder. Consistent with the foregoing, in the event that the outstanding
Stock is changed into another class or series of capital stock of the Company,
outstanding options to purchase Stock granted under the Plan shall become
options to purchase such other class or series and the provisions of this
Section 3(c) shall apply to such new class or series.
4. ELIGIBILITY.
Persons who shall be eligible to have granted to them options
provided for by the Plan shall be such employees, directors, advisors or
consultants of the Company and its affiliates as the Committee, in its absolute
discretion, determines should be awarded such incentives given the best
interests of the Company; provided, however that (i) incentive stock options may
only be granted to employees of the Company or its affiliates and (ii) any
person holding capital stock possessing more than 10% of the total combined
voting power of all classes of stock of the Company or any parent or subsidiary
corporation (a "10% shareholder") shall not be eligible to receive incentive
stock options unless the exercise price per share of the Stock subject thereto
is at least 110% of the fair market value of such Stock on the date the option
is granted.
As used herein, "Continuous Status as an Employee" shall mean the
absence of any interruption or termination of the employment relationship by the
Company or its affiliates. Continuous Status as an Employee shall not be
considered interrupted in the case of: (i) sick leave; (ii) military leave;
(iii) any other leave of absence approved by the Committee, provided that such
leave is for a period of not more than ninety (90) days, unless reemployment
upon the expiration of such leave is guaranteed by contract or statute, or
unless provided otherwise pursuant to Company policy adopted from time to time;
or (iv) transfers between locations of the Company or between the Company, its
affiliates or successor.
5. TERMINATION OF OPTION.
(a) Termination of Employment. In the event of termination of an
optionee's advisory or consulting relationship or Continuous Status as an
Employee with the Company or its affiliates, as the case may be, such optionee
may, but only during the Termination Period specified below, exercise the option
to the extent that the optionee was entitled to exercise it at the date of such
termination. The Termination Period shall be thirty (30) days (or such longer
period of time as the Committee determines, provided that, in the case of an
incentive stock option, such
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determination shall be made at the time of grant of the option and such period
of time shall not be more than ninety (90) days) 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). 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
Termination Period, the option shall terminate. No termination shall be deemed
to occur and this Section 5 shall not apply if (i) the optionee is an advisor or
a consultant who becomes an employee within the Termination Period, or (ii) the
optionee is an employee who becomes an advisor or a consultant within the
Termination Period. In the case of an optionee who performs services as an
advisor or a consultant to the Company or its affiliates on a project-by-project
basis, completion of a project shall not constitute termination of the advisory
or consulting relationship, regardless of the period of time elapsed before the
next project, if any, unless the Committee determines otherwise. Change in
status from one type of advisor or consultant to another (e.g., from advisor or
consultant to director) shall not constitute termination of the advisory or
consulting relationship.
(b) Disability of Optionee. Notwithstanding the provisions of
Section 5(a) above, in the event of termination of an optionee's advisory or
consulting relationship or Continuous Status as an Employee as a result of
optionee's disability (within the meaning of Section 22(e)(3) of the Code), the
Optionee may exercise the Option at any time within one year (or such other
period of time as the Committee determines, provided that, in the case of an
incentive stock option, such determination shall be made at the time of the
grant of the option and such period of time shall not be more than twelve (12)
months) after such termination, but only to the extent that the Option is
exercisable on the date of such termination and does not otherwise expire. Upon
termination of an Optionee's employment or other relationship with the Company
by reason of the Optionee's disability other than as defined in Section 22(d)(3)
of the Code, the Optionee may exercise the Option at any time within six (6)
months after such termination, but only to the extent that the Option is
exercisable on the date of such termination and does not otherwise expire. To
the extent that Optionee was not entitled to exercise the option at the date of
termination, or if Optionee does not exercise such option to the extent so
entitled within the time specified herein, the option shall terminate.
(c) Death of Optionee. In the event of the death of an optionee,
the option may be exercised, at any time within twelve (12) months (or such
other period of time as the Committee determines, provided that, in the case of
an incentive stock option, such determination shall be made at the time of grant
of the option and such period of time shall not be more than twelve (12) months
following the date of optionee's death but in no event later than the expiration
date of the term of such option as set forth in the optionee's option
agreement), 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 the
optionee was entitled to exercise the option at the date of death. To the extent
that optionee was not entitled to exercise the option at the date of
termination, or if optionee does not exercise such option to the extent so
entitled within the time specified herein, the option shall terminate.
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6. EXERCISE PRICE FOR OPTIONS GRANTED UNDER THE PLAN.
(a) The exercise price of a nonqualified stock option granted
under the Plan shall be the price determined by the Committee on the date the
option is granted; provided, however, that such price shall not be less than 85%
of the per share fair market value of such Stock on the date the option is
granted. The exercise price of an incentive stock option shall not be less than
100% of the per share fair market value of the Stock on the date the option is
granted; provided, however that the exercise price of incentive stock options
granted to any 10% shareholder shall be at least 110% of the per share fair
market value of the Stock on the date the option is granted. The price of an
incentive stock option or nonqualified stock option granted under the Plan shall
be subject to adjustment to the extent provided in Section 3(c).
(b) The fair market value of the Stock under this Plan shall be
determined as follows:
(i) if the Stock is quoted on the NASDAQ National Market
System or listed on a national securities exchange, the last reported sale price
or, if no such reported sale takes place on any day, the average of the closing
bid and asked prices, or
(ii) if such Stock shall not be quoted on such National
Market System nor listed or admitted to trading on a national securities
exchange, then the average of the closing bid and asked prices, as reported by
The Wall Street Journal for the over-the-counter market, or
(iii) if neither of the foregoing is applicable, then the
fair market value of a share of Stock shall be determined in good faith by the
Committee in its reasonable discretion.
7. TERMS AND CONDITIONS OF OPTIONS.
(a) Each option granted pursuant to the Plan shall be evidenced
by a written stock option agreement executed by the Company and the Participant
to whom such option is granted. The option agreement shall designate whether the
option is an incentive stock option or a nonqualified stock option.
(b) The term of each incentive stock option shall be for no more
than ten (10) years, provided, however, that the term of any incentive stock
option granted to a 10% shareholder shall not be more than five (5) years, and
no incentive stock option shall be granted more than ten (10) years after the
earlier of (i) the date the Plan was adopted or (ii) the date the Plan was
approved by the Company's shareholders. Notwithstanding the foregoing, no option
granted under the Plan may vest at less than 20% per year over five consecutive
years.
(c) If the aggregate fair market value of Stock with respect to
which incentive stock options are exercisable for the first time by a
Participant during any calendar year (under this Plan or under any other plan of
the Company or any parent or subsidiary of the Company) exceeds $100,000, the
options for the first $100,000 worth of Stock to become exercisable in such
calendar year shall be incentive stock options and the options for the amount in
excess of $100,000 that becomes exercisable in that calendar year shall be
treated as nonqualified stock options.
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(d) The stock option agreement may contain such other terms,
provisions and conditions as may be determined by the Committee, provided that
they are not inconsistent with this Plan. If an option, or any part thereof, is
intended to qualify as an incentive stock option, the stock option agreement
shall contain those terms and conditions which are necessary to so qualify it.
(e) The Committee shall have full power and authority to extend
the period of time for which any option granted under the Plan is to remain
exercisable following the Participant's cessation of service as an employee,
director, advisor or consultant of the Company or its affiliates, including
without limitation cessation as a result of such Participant's death or
disability (as defined in Section 22(e)(3) of the Code); provided, however, that
in no event shall such option be exercisable after the expiration date of the
option term specified in such Participant's option agreement covering such
option; and provided further that incentive stock options shall not be
exercisable more than ninety (90) days following termination of any
Participant's employment for any reason other than death or disability (as
defined in Section 22(e)(3) of the Code) and more than one year following
termination of any Participant's employment due to death or disability (as
defined in Section 22(e)(3) of the Code).
(f) The Committee shall have full power and authority to effect
at any time and from time to time, with the consent of the affected
Participants, the cancellation of any or all outstanding options under the Plan
and to grant in substitution new options under the Plan covering the same or
different numbers of shares of Stock with the same or different exercise prices.
(g) In the event of any Participant's death or disability (as
defined in Section 22(e)(3) of the Code), and only in such an event, the
Committee shall have full power and authority to accelerate the times at which
any options issued under this Plan become exercisable and the times at which any
shares of Stock issued under this Plan are no longer subject to transfer
restrictions or repurchase rights in favor of the Company.
8. USE OF PROCEEDS.
Cash proceeds realized from the sale of Stock under the Plan shall
constitute general funds of the Company.
9. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN.
(a) The Committee may at any time suspend or terminate the Plan,
and may amend it from time to time in such respects as the Committee may deem
advisable, provided, however, that such amendment, suspension or termination
complies with all applicable state and federal requirements and requirements of
any stock exchange on which the Stock is then listed, including any applicable
requirement that the Plan or an amendment to the Plan be approved by the
Company's shareholders. The Plan shall terminate on the earlier of (i) ten (10)
years from the date the Plan is adopted or (ii) the date on which no additional
shares of Stock are available for issuance under the Plan.
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(b) No option may be granted during any suspension or after the
termination of the Plan, and no amendment, suspension or termination of the Plan
shall, without the Participant's consent, alter or impair any rights or
obligations under any option granted under the Plan or any shares issued upon
exercise of any option; provided, however, that the Committee shall have the
right to amend, suspend or terminate any option to (i) convert outstanding
incentive stock options into nonqualified stock options or (ii) provide for a
forfeiture of the Participant's rights in the event the Participant competes
with the Company or, if the Participant is an employee, in the event the
Participant is terminated for cause.
10. ASSIGNABILITY OF OPTIONS AND RIGHTS.
Each option granted pursuant to this Plan shall, during the
Participant's lifetime, be exercisable only by him or her, and no option shall
be transferable by the Participant by operation of law or otherwise other than
by will or the laws of descent and distribution.
11. PAYMENT UPON EXERCISE.
Payment of the purchase price upon exercise of any option granted
under this Plan shall be made in whole or in part (a) in cash or, in the
discretion of the Committee, (i) by check, (ii) by delivery to the Company of
the optionee's promissory note, or (iii) by delivery of shares of Stock owned by
optionee for at least six (6) months or such other period as may be required to
avoid a charge to the Company's earnings; (b) with such other consideration as
the Committee, in its absolute discretion, determines is consistent with the
Plan's purpose and applicable law; or (c) in any combination of the foregoing.
Any Stock used to exercise options to purchase Stock shall be valued at its fair
market value on the date of the exercise of the option. Any notes used to
exercise options shall (i) be full recourse, (ii) bear interest at the lowest
rate required to avoid imputed interest under federal and state income tax laws,
(iii) be due in no more than five (5) years (subject to acceleration, if the
stock option agreement so provides, upon the optionee's termination of
employment or service) or upon sale of the Stock, (iv) provide for payment of
interest, compounded annually, at maturity, (v) be secured by the shares of
Stock in the Company acquired therewith, and (vi) contain such terms as the
Committee shall determine. Such consideration also may be paid through a
broker-dealer sale and remittance procedure pursuant to which the Participant
shall (a) provide irrevocable written instructions to a designated brokerage
firm to effect the immediate sale of the purchased shares and remit to the
Company, out of the sale proceeds available on the settlement date, sufficient
funds to cover the aggregate option price payable for the purchased shares plus
all applicable federal and state income and employment taxes required to be
withheld by the Company in connection with such purchase and (b) provide written
directives to the Company to deliver the certificates for the purchased shares
directly to such brokerage firm in order to complete the sale transaction.
12. WITHHOLDING TAXES.
(a) Subject to subsection (b), shares of Stock issued hereunder
shall be delivered to a Participant only upon payment in cash by such person to
the Company of the amount of any withholding tax which may be imposed thereon
under the provisions of the Code as then in effect or any law of any other
taxing jurisdiction requiring such withholding tax.
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(b) The Committee may, under such terms and conditions as it
deems appropriate, authorize a Participant to satisfy withholding tax
obligations under this Section 12 by delivering shares of Stock or by electing
to have the Company withhold from the Stock to be issued to the Participant
shares of Stock, in each case having a fair market value equal to the amount of
the withholding tax required to be withheld.
13. RATIFICATION.
This Plan and all options issued under this Plan shall be void
unless this Plan is approved or ratified by a majority of the votes cast at a
shareholder meeting at which a quorum representing at least a majority of the
outstanding shares entitled to vote is (either in person or by proxy) present
and voting on the Plan within twelve (12) months of the date this Plan is
adopted by the Board. No incentive stock option shall be exercisable prior to
the date such shareholder approval is obtained.
14. LOANS.
(a) The Committee may, in its discretion, assist any Participant
in the exercise of options granted under this Plan, including the satisfaction
of any federal and state income and employment tax obligations arising
therefrom, by authorizing the extension of a loan from the Company to such
Participant. The terms of any loan (including the interest rate and terms of
repayment) will be upon such terms as the Committee specifies in the applicable
loan agreement or otherwise deems appropriate under the circumstances. Loans may
be granted with or without security or collateral (other than to Participants
who are not employees, in which event the loan must be adequately secured by
collateral other than the purchased shares). However, the maximum credit
available to the Participant may not exceed the exercise or purchase price of
the acquired shares of Stock plus any federal and state income and employment
tax liability incurred by the Participant in connection with the acquisition of
such shares of Stock.
(b) The Committee may, in its absolute discretion, determine that
one or more loans extended under this financial assistance program shall be
subject to forgiveness by the Company in whole or in part upon such terms and
conditions as the Committee may deem appropriate.
15. REGULATORY APPROVALS.
All actions taken or proposed to be taken pursuant to this Plan
shall be subject to the Company's procurement of all approvals and permits
required by regulatory authorities having jurisdiction over this Plan and
compliance with all applicable state and federal securities laws and listing
requirements of any securities exchange or trading system on which the Stock is
then listed or traded.
16. NO EMPLOYMENT/SERVICE RIGHTS.
Neither the action of the Company in establishing this Plan, nor
any action taken by the Committee hereunder, nor any provision of this Plan
shall be construed so as to grant any individual the right to remain in the
employ or service of the Company (or any parent, subsidiary
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or affiliated corporation) for any period of specific duration, and the Company
(or any parent, subsidiary or affiliated corporation retaining the services of
such individual) may terminate such individual's employment or service at any
time and for any reason, with or without cause.
17. MISCELLANEOUS PROVISIONS.
(a) The right to acquire Stock or other assets under this Plan
may not be assigned, encumbered or otherwise transferred by any Participant
except pursuant to Section 10 hereinabove.
(b) The provisions of this Plan shall be governed by the laws of
the State of California, as such laws are applied to contracts entered into and
performed in such State.
(c) The provisions of this Plan shall inure to the benefit of,
and be binding upon, the Company and its successors or assigns, and the
Participants and the legal representatives of their respective estates, their
respective heirs or legatees and their permitted assignees.
(d) The Company shall provide to each Participant, on a periodic
basis (but not less than annually), financial statements of the Company. The
Company may provide other information regarding the Company as determined by the
Board in its discretion.
(e) No Participant shall disclose any confidential information
about the Company disclosed to the Participant in his or her capacity as a
holder of Options. A Participant may, however, disclose such information to his
or her legal and financial advisers in connection with advice to be rendered by
them to the Participant, or to any transferee of the Shares, but only if the
advisor or transferee agrees not to further disclose such information or to use
the information for the benefit of anyone other than the Participant, the
transferee as a holder of the Shares, or the Company.
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