ADEXA, INC.
2000 STOCK INCENTIVE PLAN
(AS ADOPTED EFFECTIVE August 24, 2000)
TABLE OF CONTENTS
Page
ARTICLE 1. INTRODUCTION.....................................................1
ARTICLE 2. ADMINISTRATION...................................................1
2.1 Committee Composition..........................................1
2.2 Committee Responsibilities.....................................1
2.3 Committee for Non-Officer Grants...............................1
ARTICLE 3. SHARES AVAILABLE FOR GRANTS......................................2
3.1 Basic Limitation...............................................2
3.2 Annual Increase in Shares......................................2
3.3 Additional Shares..............................................2
ARTICLE 4. ELIGIBILITY......................................................2
4.1 Nonstatutory Stock Options and Restricted Shares...............2
4.2 Incentive Stock Options........................................2
ARTICLE 5. OPTIONS..........................................................3
5.1 Stock Option Agreement.........................................3
5.2 Number of Shares...............................................3
5.3 Exercise Price.................................................3
5.4 Exercisability and Term........................................3
5.5 Effect of Change in Control....................................3
5.6 Modification or Assumption of Options..........................3
5.7 Buyout Provisions..............................................4
ARTICLE 6. PAYMENT FOR OPTION SHARES........................................4
6.1 General Rule...................................................4
6.2 Surrender of Stock.............................................4
6.3 Exercise/Sale..................................................4
6.4 Exercise/Pledge................................................4
6.5 Promissory Note................................................4
6.6 Other Forms of Payment.........................................5
ARTICLE 7. AUTOMATIC OPTION GRANTS TO OUTSIDE DIRECTORS.....................5
7.1 Initial Grants.................................................5
7.2 Annual Grants..................................................5
7.3 Accelerated Exercisability.....................................5
7.4 Exercise Price.................................................5
7.5 Term...........................................................6
7.6 Affiliates of Outside Directors................................6
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ARTICLE 8. RESTRICTED SHARES................................................6
8.1 Restricted Stock Agreement.....................................6
8.2 Payment for Awards.............................................6
7.3 Vesting Conditions.............................................6
8.4 Voting and Dividend Rights.....................................6
ARTICLE 9. PROTECTION AGAINST DILUTION......................................7
9.1 Adjustments....................................................7
9.2 Dissolution or Liquidation.....................................7
9.3 Reorganizations................................................7
ARTICLE 10. DEFERRAL OF DELIVERY OF SHARES..................................7
ARTICLE 11. AWARDS UNDER OTHER PLANS........................................8
ARTICLE 12. LIMITATION ON RIGHTS............................................8
12.1 Retention Rights..............................................8
12.2 Stockholders' Rights..........................................8
12.3 Regulatory Requirements.......................................8
ARTICLE 13. WITHHOLDING TAXES...............................................8
13.1 General.......................................................8
13.2 Share Withholding.............................................9
ARTICLE 14. LIMITATION ON PAYMENTS..........................................9
14.1 Scope of Limitation...........................................9
14.2 Basic Rule....................................................9
14.3 Reduction of Payments.........................................9
14.4 Overpayments and Underpayments...............................10
14.5 Related Corporations.........................................10
ARTICLE 15. FUTURE OF THE PLAN.............................................10
15.1 Term of the Plan.............................................10
15.2 Amendment or Termination.....................................10
ARTICLE 16. DEFINITIONS....................................................11
ARTICLE 17. EXECUTION......................................................14
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ADEXA, INC.
2000 STOCK INCENTIVE PLAN
ARTICLE 1. INTRODUCTION.
The Board adopted the Plan effective as of the date of the
Company's initial public offering. The purpose of the Plan is to promote the
long-term success of the Company and the creation of stockholder value by (a)
encouraging Employees, Outside Directors and Consultants to focus on critical
long-range objectives, (b) encouraging the attraction and retention of
Employees, Outside Directors and Consultants with exceptional qualifications and
(c) linking Employees, Outside Directors and Consultants directly to stockholder
interests through increased stock ownership. The Plan seeks to achieve this
purpose by providing for Awards in the form of Restricted Shares or Options
(which may constitute incentive stock options or nonstatutory stock options).
The Plan shall be governed by, and construed in accordance
with, the laws of the State of Delaware (except their choice-of-law provisions).
ARTICLE 2. ADMINISTRATION.
2.1 COMMITTEE COMPOSITION. The Committee shall administer the
Plan. The Committee shall consist exclusively of two or more directors of the
Company, who shall be appointed by the Board. In addition, the composition of
the Committee shall satisfy:
(a) Such requirements as the Securities and Exchange
Commission may establish for administrators acting under plans intended
to qualify for exemption under Rule 16b-3 (or its successor) under the
Exchange Act; and
(b) Such requirements as the Internal Revenue Service
may establish for outside directors acting under plans intended to
qualify for exemption under section 162(m)(4)(C) of the Code.
2.2 COMMITTEE RESPONSIBILITIES. The Committee shall (a) select
the Employees, Outside Directors and Consultants who are to receive Awards under
the Plan, (b) determine the type, number, vesting requirements and other
features and conditions of such Awards, (c) interpret the Plan and (d) make all
other decisions relating to the operation of the Plan. The Committee may adopt
such rules or guidelines as it deems appropriate to implement the Plan. The
Committee's determinations under the Plan shall be final and binding on all
persons.
2.3 COMMITTEE FOR NON-OFFICER GRANTS. The Board may also
appoint a secondary committee of the Board, which shall be composed of one or
more directors of the Company who need not satisfy the requirements of Section
2.1. Such secondary committee may
administer the Plan with respect to Employees and Consultants who are not
considered officers or directors of the Company under section 16 of the
Exchange Act, may grant Awards under the Plan to such Employees and
Consultants and may determine all features and conditions of such Awards.
Within the limitations of this Section 2.3, any reference in the Plan to the
Committee shall include such secondary committee.
ARTICLE 3. SHARES AVAILABLE FOR GRANTS.
3.1 BASIC LIMITATION. Common Shares issued pursuant to the
Plan may be authorized but unissued shares or treasury shares. The aggregate
number of Options and Restricted Shares awarded under the Plan shall not exceed
(a) 2,000,000 plus (b) the aggregate number of Common Shares remaining available
for grants under the Predecessor Plan on the date of the Company's initial
public offering plus (c) the additional Common Shares described in Sections 3.2
and 3.3. No additional grants shall be made under the Predecessor Plan after the
date of the Company's initial public offering. The limitations of this Section
3.1 and Section 3.2 shall be subject to adjustment pursuant to Article 9.
3.2 ANNUAL INCREASE IN SHARES. As of January 1 of each year,
commencing with the year 2001, the aggregate number of Options and Restricted
Shares that may be awarded under the Plan shall automatically increase by a
number equal to the lowest of (a) 5% of the total number of Common Shares then
outstanding, (b) 15,000,000 Common Shares or (c) the number determined by the
Board.
3.3 ADDITIONAL SHARES. If Options granted under this Plan or
the Predecessor Plan are forfeited or terminate for any other reason before
being exercised, then the corresponding Common Shares shall again become
available for the grant of Options or Restricted Shares under this Plan. If
Common Shares issued upon the exercise of Options granted under this Plan or the
Predecessor Plan are forfeited, then such Common Shares shall again become
available for the grant of NSOs and Restricted Shares under this Plan. If
Restricted Shares issued under this Plan or the Predecessor Plan are forfeited,
then the corresponding Common Shares shall again become available for the grant
of NSOs and Restricted Shares under this Plan. The aggregate number of Common
Shares that may be issued under the Plan upon the exercise of ISOs shall not be
increased when Restricted Shares or other Common Shares are forfeited.
ARTICLE 4. ELIGIBILITY.
4.1 NONSTATUTORY STOCK OPTIONS AND RESTRICTED SHARES. Only
Employees, Outside Directors and Consultants shall be eligible for the grant of
NSOs and Restricted Shares.
4.2 INCENTIVE STOCK OPTIONS. Only Employees who are common-law
employees of the Company, a Parent or a Subsidiary shall be eligible for the
grant of ISOs. In addition, an Employee who owns more than 10% of the total
combined voting power of all classes of outstanding stock of the Company or any
of its Parents or Subsidiaries shall not be eligible for the grant of an ISO
unless the requirements set forth in section 422(c)(6) of the Code are
satisfied.
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ARTICLE 5. OPTIONS.
5.1 STOCK OPTION AGREEMENT. Each grant of an Option under the
Plan shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms of the Plan and
may be subject to any other terms that are not inconsistent with the Plan. The
provisions of the various Stock Option Agreements entered into under the Plan
need not be identical. Options may be granted in consideration of a reduction in
the Optionee's other compensation. A Stock Option Agreement may provide that a
new Option will be granted automatically to the Optionee when he or she
exercises a prior Option and pays the Exercise Price in the form described in
Section 6.2.
5.2 NUMBER OF SHARES. Each Stock Option Agreement shall
specify the number of Common Shares subject to the Option and shall provide for
the adjustment of such number in accordance with Article 9. Options granted to
any Optionee in a single fiscal year of the Company shall not cover more than
2,000,000 Common Shares, except that Options granted to a new Employee in the
fiscal year of the Company in which his or her service as an Employee first
commences shall not cover more than 4,000,000 Common Shares. The limitations set
forth in the preceding sentence shall be subject to adjustment in accordance
with Article 9.
5.3 EXERCISE PRICE. Each Stock Option Agreement shall specify
the Exercise Price; provided that the Exercise Price under an ISO shall in no
event be less than 100% of the Fair Market Value of a Common Share on the date
of grant and the Exercise Price under an NSO shall in no event be less than 50%
of the Fair Market Value of a Common Share on the date of grant. In the case of
an NSO, a Stock Option Agreement may specify an Exercise Price that varies in
accordance with a predetermined formula while the NSO is outstanding.
5.4 EXERCISABILITY AND TERM. Each Stock Option Agreement shall
specify the date or event when all or any installment of the Option is to become
exercisable. The Stock Option Agreement shall also specify the term of the
Option; provided that the term of an ISO shall in no event exceed 10 years from
the date of grant. A Stock Option Agreement may provide for accelerated
exercisability in the event of the Optionee's death, disability or retirement or
other events and may provide for expiration prior to the end of its term in the
event of the termination of the Optionee's service.
5.5 EFFECT OF CHANGE IN CONTROL. The Committee may determine,
at the time of granting an Option or thereafter, that such Option shall become
exercisable as to all or part of the Common Shares subject to such Option in the
event that a Change in Control occurs with respect to the Company or in the
event that the Optionee is subject to an Involuntary Termination after a Change
in Control. However, in the case of an ISO, the acceleration of exercisability
shall not occur without the Optionee's written consent. In addition,
acceleration of exercisability may be required under Section 9.3.
5.6 MODIFICATION OR ASSUMPTION OF OPTIONS. Within the
limitations of the Plan, the Committee may modify, extend or assume outstanding
options or may accept the cancellation of outstanding options (whether granted
by the Company or by another issuer) in return for the grant of new options for
the same or a different number of shares and at the same or a different exercise
price. The foregoing notwithstanding, no modification of an Option shall,
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without the consent of the Optionee, alter or impair his or her rights or
obligations under such Option.
5.7 BUYOUT PROVISIONS. The Committee may at any time (a) offer
to buy out for a payment in cash or cash equivalents an Option previously
granted or (b) authorize an Optionee to elect to cash out an Option previously
granted, in either case at such time and based upon such terms and conditions as
the Committee shall establish.
ARTICLE 6. PAYMENT FOR OPTION SHARES.
6.1 GENERAL RULE. The entire Exercise Price of Common Shares
issued upon exercise of Options shall be payable in cash or cash equivalents at
the time when such Common Shares are purchased, except as follows:
(a) In the case of an ISO granted under the Plan,
payment shall be made only pursuant to the express provisions of the
applicable Stock Option Agreement. The Stock Option Agreement may
specify that payment may be made in any form(s) described in this
Article 6.
(b) In the case of an NSO, the Committee may at any
time accept payment in any form(s) described in this Article 6.
6.2 SURRENDER OF STOCK. To the extent that this Section 6.2 is
applicable, all or any part of the Exercise Price may be paid by surrendering,
or attesting to the ownership of, Common Shares that are already owned by the
Optionee. Such Common Shares shall be valued at their Fair Market Value on the
date when the new Common Shares are purchased under the Plan. The Optionee shall
not surrender, or attest to the ownership of, Common Shares in payment of the
Exercise Price if such action would cause the Company to recognize compensation
expense (or additional compensation expense) with respect to the Option for
financial reporting purposes.
6.3 EXERCISE/SALE. To the extent that this Section 6.3 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to a securities broker approved by the Company to sell all or part of
the Common Shares being purchased under the Plan and to deliver all or part of
the sales proceeds to the Company.
6.4 EXERCISE/PLEDGE. To the extent that this Section 6.4 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) an irrevocable
direction to pledge all or part of the Common Shares being purchased under the
Plan to a securities broker or lender approved by the Company, as security for a
loan, and to deliver all or part of the loan proceeds to the Company.
6.5 PROMISSORY NOTE. To the extent that this Section 6.5 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid by delivering (on a form prescribed by the Company) a full-recourse
promissory note. However, the par value of the
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Common Shares being purchased under the Plan, if newly issued, shall be paid
in cash or cash equivalents.
6.6 OTHER FORMS OF PAYMENT. To the extent that this Section
6.6 is applicable, all or any part of the Exercise Price and any withholding
taxes may be paid in any other form that is consistent with applicable laws,
regulations and rules.
ARTICLE 7. AUTOMATIC OPTION GRANTS TO OUTSIDE DIRECTORS.
7.1 INITIAL GRANTS. Each Outside Director who first becomes a
member of the Board after the date of the Company's initial public offering
shall receive a one-time grant of an NSO covering 25,000 Common Shares. Such NSO
shall be granted on the date when such Outside Director first joins the Board
and shall become exercisable in equal annual installments over the four-year
period commencing on the date of grant. An Outside Director who previously was
an Employee shall not receive a grant under this Section 7.1.
7.2 ANNUAL GRANTS. Upon the conclusion of each regular annual
meeting of the Company's stockholders held in the year 2001 or thereafter, each
Outside Director who will continue serving as a member of the Board thereafter
shall receive an NSO covering 6,000 Common Shares, except that such NSO shall
not be granted in the calendar year in which the same Outside Director received
the NSO described in Section 7.1. NSOs granted under this Section 7.2 shall
become exercisable in full on the first anniversary of the date of grant. An
Outside Director who previously was an Employee shall be eligible to receive
grants under this Section 7.2.
7.3 ACCELERATED EXERCISABILITY. An NSO granted to an Outside
Director under this Article 7 may become exercisable on an accelerated basis as
follows:
(a) The NSO shall become exercisable in full if the
Outside Director's service terminates because of his or her death,
total and permanent disability or retirement at or after age 65.
(b) The NSO shall become exercisable in full if (i)
the Company is subject to a Change in Control before the Outside
Director's service terminates, (ii) the Company does not continue the
NSO and (iii) the surviving corporation or its parent or subsidiary
does not assume the NSO or substitute its own option for the NSO.
(c) The NSO shall become exercisable in full if (i)
the Company is subject to a Change in Control and (ii) the Outside
Director's service terminates for any reason at the time of the Change
in Control or within 12 months after the Change in Control.
7.4 EXERCISE PRICE. The Exercise Price under all NSOs granted
to an Outside Director under this Article 7 shall be equal to 100% of the Fair
Market Value of a Common Share on the date of grant, payable in one of the forms
described in Sections 6.1, 6.2 and 6.3.
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7.5 TERM. All NSOs granted to an Outside Director under this
Article 7 shall terminate on the earlier of (a) the 10th anniversary of the date
of grant or (b) the date 12 months after the termination of such Outside
Director's service for any reason.
7.6 AFFILIATES OF OUTSIDE DIRECTORS. The Committee may provide
that the NSOs that otherwise would be granted to an Outside Director under this
Article 7 shall instead be granted to an affiliate of such Outside Director.
Such affiliate shall then be deemed to be an Outside Director for purposes of
the Plan, provided that the service-related vesting and termination provisions
pertaining to the NSOs shall be applied with regard to the service of the
Outside Director.
ARTICLE 8. RESTRICTED SHARES.
8.1 RESTRICTED STOCK AGREEMENT. Each grant of Restricted
Shares under the Plan shall be evidenced by a Restricted Stock Agreement between
the recipient and the Company. Such Restricted Shares shall be subject to all
applicable terms of the Plan and may be subject to any other terms that are not
inconsistent with the Plan. The provisions of the various Restricted Stock
Agreements entered into under the Plan need not be identical.
8.2 PAYMENT FOR AWARDS. Subject to the following sentence,
Restricted Shares may be sold or awarded under the Plan for such consideration
as the Committee may determine, including (without limitation) cash, cash
equivalents, full-recourse promissory notes, past services and future services.
To the extent that an Award consists of newly issued Restricted Shares, the
consideration shall consist exclusively of cash, cash equivalents or past
services rendered to the Company (or a Parent or Subsidiary) or, for the amount
in excess of the par value of such newly issued Restricted Shares, full-recourse
promissory notes, as the Committee may determine.
8.3 VESTING CONDITIONS. Each Award of Restricted Shares may or
may not be subject to vesting. Vesting shall occur, in full or in installments,
upon satisfaction of the conditions specified in the Restricted Stock Agreement.
A Restricted Stock Agreement may provide for accelerated vesting in the event of
the Participant's death, disability or retirement or other events. The Committee
may determine, at the time of granting Restricted Shares or thereafter, that all
or part of such Restricted Shares shall become vested in the event that a Change
in Control occurs with respect to the Company or in the event that the
Participant is subject to an Involuntary Termination after a Change in Control.
8.4 VOTING AND DIVIDEND RIGHTS. The holders of Restricted
Shares awarded under the Plan shall have the same voting, dividend and other
rights as the Company's other stockholders. A Restricted Stock Agreement,
however, may require that the holders of Restricted Shares invest any cash
dividends received in additional Restricted Shares. Such additional Restricted
Shares shall be subject to the same conditions and restrictions as the Award
with respect to which the dividends were paid.
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ARTICLE 9. PROTECTION AGAINST DILUTION.
9.1 ADJUSTMENTS. In the event of a subdivision of the
outstanding Common Shares, a declaration of a dividend payable in Common Shares
or a combination or consolidation of the outstanding Common Shares (by
reclassification or otherwise) into a lesser number of Common Shares,
corresponding adjustments shall automatically be made in each of the following:
(a) The number of Options and Restricted Shares
available for future Awards under Article 3;
(b) The limitations set forth in Section 5.2;
(c) The number of Common Shares covered by each
outstanding Option; or
(d) The Exercise Price under each outstanding Option.
In the event of a declaration of an extraordinary dividend payable in a form
other than Common Shares in an amount that has a material effect on the price of
Common Shares, a recapitalization, a spin-off or a similar occurrence, the
Committee shall make such adjustments as it, in its sole discretion, deems
appropriate in one or more of the foregoing. Except as provided in this Article
9, a Participant shall have no rights by reason of any issuance by the Company
of stock of any class or securities convertible into stock of any class, any
subdivision or consolidation of shares of stock of any class, the payment of any
stock dividend or any other increase or decrease in the number of shares of
stock of any class.
9.2 DISSOLUTION OR LIQUIDATION. To the extent not previously
exercised, Options shall terminate immediately prior to the dissolution or
liquidation of the Company.
9.3 REORGANIZATIONS. In the event that the Company is a party
to a merger or other reorganization, outstanding Options and Restricted Shares
shall be subject to the agreement of merger or reorganization. Such agreement
shall provide for (a) the continuation of the outstanding Awards by the Company,
if the Company is a surviving corporation, (b) the assumption of the outstanding
Awards by the surviving corporation or its parent or subsidiary, (c) the
substitution by the surviving corporation or its parent or subsidiary of its own
awards for the outstanding Awards, (d) full exercisability or vesting and
accelerated expiration of the outstanding Awards or (e) settlement of the full
value of the outstanding Awards in cash or cash equivalents followed by
cancellation of such Awards.
ARTICLE 10. DEFERRAL OF DELIVERY OF SHARES.
The Committee (in its sole discretion) may permit or require
an Optionee to have Common Shares that otherwise would be delivered to such
Optionee as a result of the exercise of an Option converted into amounts
credited to a deferred compensation account established for such Optionee by the
Committee as an entry on the Company's books. Such amounts shall be determined
by reference to the Fair Market Value of such Common Shares as of the date when
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they otherwise would have been delivered to such Optionee. A deferred
compensation account established under this Article 10 may be credited with
interest or other forms of investment return, as determined by the Committee. An
Optionee for whom such an account is established shall have no rights other than
those of a general creditor of the Company. Such an account shall represent an
unfunded and unsecured obligation of the Company and shall be subject to the
terms and conditions of the applicable agreement between such Optionee and the
Company. If the conversion of Options is permitted or required, the Committee
(in its sole discretion) may establish rules, procedures and forms pertaining to
such conversion, including (without limitation) the settlement of deferred
compensation accounts established under this Article 10.
ARTICLE 11. AWARDS UNDER OTHER PLANS.
The Company may grant awards under other plans or programs.
Such awards may be settled in the form of Common Shares issued under this Plan.
Such Common Shares shall be treated for all purposes under the Plan like
Restricted Shares and shall, when issued, reduce the number of Common Shares
available under Article 3.
ARTICLE 12. LIMITATION ON RIGHTS.
12.1 RETENTION RIGHTS. Neither the Plan nor any Award granted
under the Plan shall be deemed to give any individual a right to remain an
Employee, Outside Director or Consultant. The Company and its Parents,
Subsidiaries and Affiliates reserve the right to terminate the service of any
Employee, Outside Director or Consultant at any time, with or without cause,
subject to applicable laws, the Company's certificate of incorporation and
by-laws and a written employment agreement (if any).
12.2 STOCKHOLDERS' RIGHTS. A Participant shall have no
dividend rights, voting rights or other rights as a stockholder with respect to
any Common Shares covered by his or her Award prior to the time when a stock
certificate for such Common Shares is issued or, in the case of an Option, the
time when he or she becomes entitled to receive such Common Shares by filing a
notice of exercise and paying the Exercise Price. No adjustment shall be made
for cash dividends or other rights for which the record date is prior to such
time, except as expressly provided in the Plan.
12.3 REGULATORY REQUIREMENTS. Any other provision of the Plan
notwithstanding, the obligation of the Company to issue Common Shares under the
Plan shall be subject to all applicable laws, rules and regulations and such
approval by any regulatory body as may be required. The Company reserves the
right to restrict, in whole or in part, the delivery of Common Shares pursuant
to any Award prior to the satisfaction of all legal requirements relating to the
issuance of such Common Shares, to their registration, qualification or listing
or to an exemption from registration, qualification or listing.
ARTICLE 13. WITHHOLDING TAXES.
13.1 GENERAL. To the extent required by applicable federal,
state, local or foreign law, a Participant or his or her successor shall make
arrangements satisfactory to the
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Company for the satisfaction of any withholding tax obligations that arise in
connection with the Plan. The Company shall not be required to issue any
Common Shares or make any cash payment under the Plan until such obligations
are satisfied.
13.2 SHARE WITHHOLDING. To the extent that applicable law
subjects a Participant to tax withholding obligations, the Committee may permit
such Participant to satisfy all or part of such obligations by having the
Company withhold all or a portion of any Common Shares that otherwise would be
issued to him or her or by surrendering all or a portion of any Common Shares
that he or she previously acquired. Such Common Shares shall be valued at their
Fair Market Value on the date when they are withheld or surrendered.
ARTICLE 14. LIMITATION ON PAYMENTS.
14.1 SCOPE OF LIMITATION. This Article 14 shall apply to
an Award only if:
(a) The independent auditors most recently selected
by the Board (the "Auditors") determine that the after-tax value of
such Award to the Participant, taking into account the effect of all
federal, state and local income taxes, employment taxes and excise
taxes applicable to the Participant (including the excise tax under
section 4999 of the Code), will be greater after the application of
this Article 14 than it was before the application of this Article 14;
or
(b) The Committee, at the time of making an Award
under the Plan or at any time thereafter, specifies in writing that
such Award shall be subject to this Article 14 (regardless of the
after-tax value of such Award to the Participant).
If this Article 14 applies to an Award, it shall supersede any contrary
provision of the Plan or of any Award granted under the Plan.
14.2 BASIC RULE. In the event that the Auditors determine that
any payment or transfer by the Company under the Plan to or for the benefit of a
Participant (a "Payment") would be nondeductible by the Company for federal
income tax purposes because of the provisions concerning "excess parachute
payments" in section 280G of the Code, then the aggregate present value of all
Payments shall be reduced (but not below zero) to the Reduced Amount. For
purposes of this Article 14, the "Reduced Amount" shall be the amount, expressed
as a present value, which maximizes the aggregate present value of the Payments
without causing any Payment to be nondeductible by the Company because of
section 280G of the Code.
14.3 REDUCTION OF PAYMENTS. If the Auditors determine that any
Payment would be nondeductible by the Company because of section 280G of the
Code, then the Company shall promptly give the Participant notice to that effect
and a copy of the detailed calculation thereof and of the Reduced Amount, and
the Participant may then elect, in his or her sole discretion, which and how
much of the Payments shall be eliminated or reduced (as long as after such
election the aggregate present value of the Payments equals the Reduced Amount)
and shall advise the Company in writing of his or her election within 10 days of
receipt of notice. If
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no such election is made by the Participant within such 10-day period, then
the Company may elect which and how much of the Payments shall be eliminated
or reduced (as long as after such election the aggregate present value of the
Payments equals the Reduced Amount) and shall notify the Participant promptly
of such election. For purposes of this Article 14, present value shall be
determined in accordance with section 280G(d)(4) of the Code. All
determinations made by the Auditors under this Article 14 shall be binding
upon the Company and the Participant and shall be made within 60 days of the
date when a Payment becomes payable or transferable. As promptly as
practicable following such determination and the elections hereunder, the
Company shall pay or transfer to or for the benefit of the Participant such
amounts as are then due to him or her under the Plan and shall promptly pay
or transfer to or for the benefit of the Participant in the future such
amounts as become due to him or her under the Plan.
14.4 OVERPAYMENTS AND UNDERPAYMENTS. As a result of
uncertainty in the application of section 280G of the Code at the time of an
initial determination by the Auditors hereunder, it is possible that Payments
will have been made by the Company which should not have been made (an
"Overpayment") or that additional Payments which will not have been made by the
Company could have been made (an "Underpayment"), consistent in each case with
the calculation of the Reduced Amount hereunder. In the event that the Auditors,
based upon the assertion of a deficiency by the Internal Revenue Service against
the Company or the Participant which the Auditors believe has a high probability
of success, determine that an Overpayment has been made, such Overpayment shall
be treated for all purposes as a loan to the Participant which he or she shall
repay to the Company, together with interest at the applicable federal rate
provided in section 7872(f)(2) of the Code; provided, however, that no amount
shall be payable by the Participant to the Company if and to the extent that
such payment would not reduce the amount which is subject to taxation under
section 4999 of the Code. In the event that the Auditors determine that an
Underpayment has occurred, such Underpayment shall promptly be paid or
transferred by the Company to or for the benefit of the Participant, together
with interest at the applicable federal rate provided in section 7872(f)(2) of
the Code.
14.5 RELATED CORPORATIONS. For purposes of this Article 14,
the term "Company" shall include affiliated corporations to the extent
determined by the Auditors in accordance with section 280G(d)(5) of the Code.
ARTICLE 15. FUTURE OF THE PLAN.
15.1 TERM OF THE PLAN. The Plan, as set forth herein, shall
become effective on the date of the Company's initial public offering. The Plan
shall remain in effect until it is terminated under Section 15.2, except that no
ISOs shall be granted on or after the 10th anniversary of the later of (a) the
date when the Board adopted the Plan or (b) the date when the Board adopted the
most recent increase in the number of Common Shares available under Article 3
which was approved by the Company's stockholders.
15.2 AMENDMENT OR TERMINATION. The Board may, at any time and
for any reason, amend or terminate the Plan. An amendment of the Plan shall be
subject to the approval of the Company's stockholders only to the extent
required by applicable laws, regulations or rules. No Awards shall be granted
under the Plan after the termination thereof. The termination
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of the Plan, or any amendment thereof, shall not affect any Award previously
granted under the Plan.
ARTICLE 16. DEFINITIONS.
16.1 "AFFILIATE" means any entity other than a Subsidiary, if
the Company and/or one or more Subsidiaries own not less than 50% of such
entity.
16.2 "AWARD" means any award of an Option or a Restricted
Share under the Plan.
16.3 "BOARD" means the Company's Board of Directors, as
constituted from time to time.
16.4 "CAUSE" means (a) the unauthorized use or disclosure of
the confidential information or trade secrets of the Company, which use or
disclosure causes material harm to the Company, (b) conviction of, or a plea of
"guilty" or "no contest" to, a felony under the laws of the United States or any
State thereof, (c) gross negligence, (d) willful misconduct or (e) a failure to
perform assigned duties that continues after the Participant has received
written notice of such failure from the Board. The foregoing, however, shall not
be deemed an exclusive list of all acts or omissions that the Company (or the
Parent, Subsidiary or Affiliate employing the Participant) may consider as
grounds for the discharge of the Participant without Cause.
16.5 "CHANGE IN CONTROL" means:
(a) The consummation of a merger or consolidation of
the Company with or into another entity or any other corporate
reorganization, if persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization
own immediately after such merger, consolidation or other
reorganization 50% or more of the voting power of the outstanding
securities of each of (i) the continuing or surviving entity and (ii)
any direct or indirect parent corporation of such continuing or
surviving entity;
(b) The sale, transfer or other disposition of
all or substantially all of the Company's assets;
(c) A change in the composition of the Board, as a
result of which less than a majority of the incumbent directors are
directors who either (i) had been directors of the Company on the date
24 months prior to the date of the event that may constitute a Change
in Control (the "original directors") or (ii) were elected, or
nominated for election, to the Board with the affirmative votes of at
least a majority of the aggregate of the original directors who were
still in office at the time of the election or nomination and the
directors whose election or nomination was previously so approved; or
(d) Any transaction as a result of which any person
is the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or
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indirectly, of securities of the Company representing at least 50%
of the total voting power represented by the Company's then
outstanding voting securities. For purposes of this Subsection (d),
the term "person" shall have the same meaning as when used in
sections 13(d) and 14(d) of the Exchange Act but shall exclude (i) a
trustee or other fiduciary holding securities under an employee
benefit plan of the Company or of a Parent or Subsidiary and (ii) a
corporation owned directly or indirectly by the stockholders of the
Company in substantially the same proportions as their ownership of
the common stock of the Company.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
16.6 "CODE" means the Internal Revenue Code of 1986, as
amended.
16.7 "COMMITTEE" means a committee of the Board, as described
in Article 2.
16.8 "COMMON SHARE" means one share of the common stock of the
Company.
16.9 "COMPANY" means Adexa, Inc., a Delaware corporation.
16.10 "CONSULTANT" means a consultant or adviser who provides
bona fide services to the Company, a Parent, a Subsidiary or an Affiliate as an
independent contractor. Service as a Consultant shall be considered employment
for all purposes of the Plan, except as provided in Section 4.2.
16.11 "EMPLOYEE" means a common-law employee of the Company, a
Parent, a Subsidiary or an Affiliate.
16.12 "EXCHANGE ACT" means the Securities Exchange Act of
1934, as amended.
16.13 "EXERCISE PRICE" means the amount for which one Common
Share may be purchased upon exercise of an Option, as specified in the
applicable Stock Option Agreement.
16.14 "FAIR MARKET VALUE" means the market price of Common
Shares, determined by the Committee in good faith on such basis as it deems
appropriate. Whenever possible, the determination of Fair Market Value by the
Committee shall be based on the prices reported in THE WALL STREET JOURNAL. Such
determination shall be conclusive and binding on all persons.
16.15 "INVOLUNTARY TERMINATION" means the termination of the
Participant's service by reason of:
(a) The involuntary discharge of the Participant by
the Company (or the Parent, Subsidiary or Affiliate employing him or
her) for reasons other than Cause; or
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(b) The voluntary resignation of the Participant
following (i) a material adverse change in his or her title, stature,
authority or responsibilities with the Company (or the Parent,
Subsidiary or Affiliate employing him or her), (ii) a material
reduction in his or her base salary or (iii) receipt of notice that his
or her principal workplace will be relocated by more than 30 miles.
16.16 "ISO" means an incentive stock option described in
section 422(b) of the Code.
16.17 "NSO" means a stock option not described in sections 422
or 423 of the Code.
16.18 "OPTION" means an ISO or NSO granted under the Plan and
entitling the holder to purchase Common Shares.
16.19 "OPTIONEE" means an individual or estate who holds an
Option.
16.20 "OUTSIDE DIRECTOR" means a member of the Board who is
not an Employee. Service as an Outside Director shall be considered employment
for all purposes of the Plan, except as provided in Section 4.2.
16.21 "PARENT" means any corporation (other than the Company)
in an unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.
16.22 "PARTICIPANT" means an individual or estate who holds an
Award.
16.23 "PLAN" means this Adexa, Inc. 2000 Stock Incentive Plan,
as amended from time to time.
16.24 "PREDECESSOR PLAN" means the Adexa, Inc. 1998 Stock
Plan, as amended from time to time.
16.25 "RESTRICTED SHARE" means a Common Share awarded under
the Plan.
16.26 "RESTRICTED STOCK AGREEMENT" means the agreement between
the Company and the recipient of a Restricted Share that contains the terms,
conditions and restrictions pertaining to such Restricted Share.
16.27 "STOCK OPTION AGREEMENT" means the agreement between the
Company and an Optionee that contains the terms, conditions and restrictions
pertaining to his or her Option.
16.28 "SUBSIDIARY" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company, if
each of the corporations other
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than the last corporation in the unbroken chain owns stock possessing 50% or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain. A corporation that attains the status of a
Subsidiary on a date after the adoption of the Plan shall be considered a
Subsidiary commencing as of such date.
ARTICLE 17. EXECUTION.
To record the adoption of the Plan by the Board on August 24,
2000, the Company has caused its duly authorized officer to execute this
document in the name of the Company.
ADEXA, INC.
By: /s/ J. Timothy Romer
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Title: Chief Financial Officer
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