TRADEWEAVE, INC.
STOCK ISSUANCE AGREEMENT
AGREEMENT made as of this ____ day of ___________________________, by and
between Tradeweave, Inc., a Delaware corporation, and _____________________,
Participant in the Corporation's 1999 Stock Option/Stock Issuance Plan.
All capitalized terms in this Agreement shall have the meaning assigned to
them in this Agreement or in the attached Appendix.
A. PURCHASE OF SHARES
1. PURCHASE. Participant hereby purchases ___________________ shares of
Common Stock (the "Purchased Shares") pursuant to the provisions of the Stock
Issuance Program at the purchase price of $_____________ per share (the
"Purchase Price").
2. PAYMENT. Concurrently with the delivery of this Agreement to the
Corporation, Participant shall pay the Purchase Price for the Purchased Shares
in cash or cash equivalent and shall deliver a duly-executed blank Assignment
Separate from Certificate (in the form attached hereto as Exhibit I) with
respect to the Purchased Shares.
3. STOCKHOLDER RIGHTS. Until such time as the Corporation exercises the
Repurchase Right or the First Refusal Right, Participant (or any successor in
interest) shall have all stockholder rights (including voting, dividend and
liquidation rights) with respect to the Purchased Shares, subject, however, to
the transfer restrictions of Articles B and C.
B. SECURITIES LAW COMPLIANCE
1. RESTRICTED SECURITIES. The Purchased Shares have not been
registered under the 1933 Act and are being issued to Participant in reliance
upon the exemption from such registration provided by SEC Rule 701 for stock
issuances under compensatory benefit plans such as the Plan. Participant hereby
confirms that Participant has been informed that the Purchased Shares are
restricted securities under the 1933 Act and may not be resold or transferred
unless the Purchased Shares are first registered under the Federal securities
laws or unless an exemption from such registration is available. Accordingly,
Participant hereby acknowledges that Participant is prepared to hold the
Purchased Shares for an indefinite period and that Participant is aware that SEC
Rule 144 issued under the 1933 Act which exempts certain resales of unrestricted
securities is not presently available to exempt the resale of the Purchased
Shares from the registration requirements of the 1933 Act.
DISPOSITION OF PURCHASED SHARES. Participant shall make no disposition of
the Purchased Shares (other than a Permitted Transfer) unless and until there is
compliance with all of the following requirements:
(i) Participant shall have provided the Corporation with a written
summary of the terms and conditions of the proposed disposition.
(ii) Participant shall have complied with all requirements of this
Agreement applicable to the disposition of the Purchased Shares.
(iii) Participant shall have provided the Corporation with written
assurances, in form and substance satisfactory to the Corporation, that (a)
the proposed disposition does not require registration of the Purchased
Shares under the 1933 Act or (b) all appropriate action necessary for
compliance with the registration requirements of the 1933 Act or any
exemption from registration available under the 1933 Act (including Rule
144) has been taken.
The Corporation shall NOT be required (i) to transfer on its books any
Purchased Shares which have been sold or transferred in violation of the
provisions of this Agreement OR (ii) to treat as the owner of the Purchased
Shares, or otherwise to accord voting, dividend or liquidation rights to,
any transferee to whom the Purchased Shares have been transferred in
contravention of this Agreement.
3. RESTRICTIVE LEGENDS. The stock certificates for the Purchased
Shares shall be endorsed with one or more of the following restrictive
legends:
"The shares represented by this certificate have not been registered
under the Securities Act of 1933. The shares may not be sold or offered for
sale in the absence of (a) an effective registration statement for the
shares under such Act, (b) a "no action" letter of the Securities and
Exchange Commission with respect to such sale or offer or (c) satisfactory
assurances to the Corporation that registration under such Act is not
required with respect to such sale or offer."
"The shares represented by this certificate are subject to certain
repurchase rights and rights of first refusal granted to the Corporation
and accordingly may not be sold, assigned, transferred, encumbered, or in
any manner disposed of except in conformity with the terms of a written
agreement dated __________________, ______, between the Corporation and the
registered holder of the shares (or the predecessor in interest to the
shares). A copy of such agreement is maintained at the Corporation's
principal corporate offices."
2.
C. TRANSFER RESTRICTIONS
1. RESTRICTION ON TRANSFER. Except for any Permitted Transfer,
Participant shall not transfer, assign, encumber or otherwise dispose of
any of the Purchased Shares which are subject to the Repurchase Right. In
addition, Purchased Shares which are released from the Repurchase Right
shall not be transferred, assigned, encumbered or otherwise disposed of in
contravention of the First Refusal Right or the Market Stand-Off.
2. TRANSFEREE OBLIGATIONS. Each person (other than the Corporation) to
whom the Purchased Shares are transferred by means of a Permitted Transfer
must, as a condition precedent to the validity of such transfer,
acknowledge in writing to the Corporation that such person is bound by the
provisions of this Agreement and that the transferred shares are subject to
(i) the Repurchase Right, (ii) the First Refusal Right and (iii) the Market
Stand-Off, to the same extent such shares would be so subject if retained
by Participant.
3. MARKET STAND-OFF.
(a) In connection with any underwritten public offering by the
Corporation of its equity securities pursuant to an effective registration
statement filed under the 1933 Act, including the Corporation's initial
public offering, Owner shall not sell, make any short sale of, loan,
hypothecate, pledge, grant any option for the purchase of, or otherwise
dispose or transfer for value or otherwise agree to engage in any of the
foregoing transactions with respect to, any Purchased Shares without the
prior written consent of the Corporation or its underwriters. Such
restriction (the "Market Stand-Off") shall be in effect for such period of
time from and after the effective date of the final prospectus for the
offering as may be requested by the Corporation or such underwriters. In no
event, however, shall such period exceed one hundred eighty (180) days, and
the Market Stand-Off shall in no event be applicable to any underwritten
public offering effected more than two (2) years after the effective date
of the Corporation's initial public offering.
(b) Owner shall be subject to the Market Stand-Off PROVIDED AND ONLY
IF the officers and directors of the Corporation are also subject to
similar restrictions.
(c) Any new, substituted or additional securities which are by reason
of any Recapitalization or Reorganization distributed with respect to the
Purchased Shares shall be immediately subject to the Market Stand-Off, to
the same extent the Purchased Shares are at such time covered by such
provisions.
(d) In order to enforce the Market Stand-Off, the Corporation may
impose stop-transfer instructions with respect to the Purchased Shares
until the end of the applicable stand-off period.
3.
D. REPURCHASE RIGHT
1. GRANT. The Corporation is hereby granted the right (the "Repurchase
Right"), exercisable at any time during the sixty (60)-day period following
the date Participant ceases for any reason to remain in Service, to
repurchase at the Purchase Price any or all of the Purchased Shares in
which Participant is not, at the time of his or her cessation of Service,
vested in accordance with the provisions of the Vesting Schedule set forth
in Paragraph D.3 or the special vesting acceleration provisions of
Paragraph D.5 (such shares to be hereinafter referred to as the "Unvested
Shares").
2. EXERCISE OF THE REPURCHASE RIGHT. The Repurchase Right shall be
exercisable by written notice delivered to each Owner of the Unvested
Shares prior to the expiration of the sixty (60)-day exercise period. The
notice shall indicate the number of Unvested Shares to be repurchased and
the date on which the repurchase is to be effected, such date to be not
more than thirty (30) days after the date of such notice. The certificates
representing the Unvested Shares to be repurchased shall be delivered to
the Corporation on the closing date specified for the repurchase.
Concurrently with the receipt of such stock certificates, the Corporation
shall pay to Owner, in cash or cash equivalents (including the cancellation
of any purchase-money indebtedness), an amount equal to the Purchase Price
previously paid for the Unvested Shares which are to be repurchased from
Owner.
3. TERMINATION OF THE REPURCHASE RIGHT. The Repurchase Right shall
terminate with respect to any Unvested Shares for which it is not timely
exercised under Paragraph D.2. In addition, the Repurchase Right shall
terminate and cease to be exercisable with respect to any and all Purchased
Shares in which Participant vests in accordance with the following Vesting
Schedule:
(i) Participant shall vest in twenty-five percent (25%) of the
Purchased Shares, and the Repurchase Right shall concurrently lapse with
respect to those Purchased Shares, upon Participant's completion of one (1)
year of Service measured from ___________________, ______________.
(ii) Participant shall vest in the remaining seventy-five percent
(75%) of the Purchased Shares, and the Repurchase Right shall concurrently
lapse with respect to those Purchased Shares, in a series of three (3)
successive equal annual installments upon Participant's completion of each
additional year of Service over the three (3)-year period measured from the
date on which the first twenty-five percent (25%) of the Purchased Shares
vests hereunder.
All Purchased Shares as to which the Repurchase Right lapses shall,
however, remain subject to (i) the First Refusal Right and (ii) the Market
Stand-Off.
4.
4. RECAPITALIZATION. Any new, substituted or additional securities or
other property (including cash paid other than as a regular cash dividend)
which is by reason of any Recapitalization distributed with respect to the
Purchased Shares shall be immediately subject to the Repurchase Right and
any escrow requirements hereunder, but only to the extent the Purchased
Shares are at the time covered by such right or escrow requirements.
Appropriate adjustments to reflect such distribution shall be made to the
number and/or class of Purchased Shares subject to this Agreement and to
the price per share to be paid upon the exercise of the Repurchase Right in
order to reflect the effect of any such Recapitalization upon the
Corporation's capital structure; PROVIDED, however, that the aggregate
purchase price shall remain the same.
5. CHANGE IN CONTROL
(a) The Repurchase Right shall automatically terminate in its
entirety, and all the Purchased Shares shall vest in full, immediately
prior to the consummation of any Change in Control, except to the extent
the Repurchase Right is to be assigned to the successor entity in such
Change in Control or otherwise continued in full force and effect pursuant
to the express terms of the Change in Control transaction.
(b) To the extent the Repurchase Right is assigned to the successor
entity or otherwise remains in effect following a Change in Control, such
right shall apply to any new securities or other property (including any
cash payments) received in exchange for the Purchased Shares in
consummation of the Change in Control, but only to the extent the Purchased
Shares are at the time covered by such right. Appropriate adjustments shall
be made to the price per share payable upon exercise of the Repurchase
Right to reflect the effect of the Change in Control upon the Corporation's
capital structure; PROVIDED, however, that the aggregate purchase price
shall remain the same. The new securities or other property (including any
cash payments) issued or distributed with respect to the Purchased Shares
in consummation of the Change in Control shall be immediately deposited in
escrow with the Corporation (or the successor entity) and shall not be
released from escrow until Participant vests in such securities or other
property in accordance with the same Vesting Schedule in effect for the
Purchased Shares.
E. RIGHT OF FIRST REFUSAL
1. GRANT. The Corporation is hereby granted the right of first refusal
(the "First Refusal Right"), exercisable in connection with any proposed
transfer of the Purchased Shares in which Participant has vested in
accordance with the provisions of Article D. For purposes of this Article
E, the term "transfer" shall include any sale, assignment, pledge,
encumbrance or other disposition of the Purchased Shares intended to be
made by Owner, but shall not include any Permitted Transfer.
5.
2. NOTICE OF INTENDED DISPOSITION. In the event any Owner of Purchased
Shares in which Participant has vested desires to accept a bona fide
third-party offer for the transfer of any or all of such shares (the
Purchased Shares subject to such offer to be hereinafter referred to as the
"Target Shares"), Owner shall promptly (i) deliver to the Corporation
written notice (the "Disposition Notice") of the terms of the offer,
including the purchase price and the identity of the third-party offeror,
and (ii) provide satisfactory proof that the disposition of the Target
Shares to such third-party offeror would not be in contravention of the
provisions set forth in Articles B and C.
3. EXERCISE OF THE FIRST REFUSAL RIGHT. The Corporation shall, for a
period of twenty-five (25) days following receipt of the Disposition
Notice, have the right to repurchase any or all of the Target Shares
subject to the Disposition Notice upon the same terms as those specified
therein or upon such other terms (not materially different from those
specified in the Disposition Notice) to which Owner consents. Such right
shall be exercisable by delivery of written notice (the "Exercise Notice")
to Owner prior to the expiration of the twenty-five (25)-day exercise
period. If such right is exercised with respect to all the Target Shares,
then the Corporation shall effect the repurchase of such shares, including
payment of the purchase price, not more than five (5) business days after
delivery of the Exercise Notice; and at such time the certificates
representing the Target Shares shall be delivered to the Corporation.
Should the purchase price specified in the Disposition Notice be
payable in property other than cash or evidences of indebtedness, the
Corporation shall have the right to pay the purchase price in the form of
cash equal in amount to the value of such property. If Owner and the
Corporation cannot agree on such cash value within ten (10) days after the
Corporation's receipt of the Disposition Notice, the valuation shall be
made by an appraiser of recognized standing selected by Owner and the
Corporation or, if they cannot agree on an appraiser within twenty (20)
days after the Corporation's receipt of the Disposition Notice, each shall
select an appraiser of recognized standing and the two (2) appraisers shall
designate a third appraiser of recognized standing, whose appraisal shall
be determinative of such value. The cost of such appraisal shall be shared
equally by Owner and the Corporation. The closing shall then be held on the
LATER of (i) the fifth (5th) business day following delivery of the
Exercise Notice or (ii) the fifth (5th) business day after such valuation
shall have been made.
4. NON-EXERCISE OF THE FIRST REFUSAL RIGHT. In the event the Exercise
Notice is not given to Owner prior to the expiration of the twenty-five
(25)-day exercise period, Owner shall have a period of thirty (30) days
thereafter in which to sell or otherwise dispose of the Target Shares to
the third-party offeror identified in the Disposition Notice upon terms
(including the purchase price) no more favorable to such third-party
offeror than those specified in the Disposition Notice; PROVIDED, however,
that any such sale or disposition must not be effected in contravention of
the provisions of Articles B and C. The third-party offeror shall acquire
the Target Shares subject to the First Refusal Right and the provisions and
restrictions of Article B and Paragraph C.3, and any subsequent disposition
of the acquired shares must be effected in compliance with the terms and
conditions of such First Refusal Right and the
6.
provisions and restrictions of Article B and Paragraph C.3. In the event
Owner does not effect such sale or disposition of the Target Shares within
the specified thirty (30)-day period, the First Refusal Right shall
continue to be applicable to any subsequent disposition of the Target
Shares by Owner until such right lapses.
5. PARTIAL EXERCISE OF THE FIRST REFUSAL RIGHT. In the event the
Corporation makes a timely exercise of the First Refusal Right with respect
to a portion, but not all, of the Target Shares specified in the
Disposition Notice, Owner shall have the option, exercisable by written
notice to the Corporation delivered within five (5) business days after
Owner's receipt of the Exercise Notice, to effect the sale of the Target
Shares pursuant to either of the following alternatives:
(i) sale or other disposition of all the Target Shares to the
third-party offeror identified in the Disposition Notice, but in full
compliance with the requirements of Paragraph E.4, as if the
Corporation did not exercise the First Refusal Right; or
(ii) sale to the Corporation of the portion of the Target Shares
which the Corporation has elected to purchase, such sale to be
effected in substantial conformity with the provisions of Paragraph
E.3. The First Refusal Right shall continue to be applicable to any
subsequent disposition of the remaining Target Shares until such right
lapses.
Owner's failure to deliver timely notification to the Corporation
shall be deemed to be an election by Owner to sell the Target Shares
pursuant to alternative (i) above.
6. RECAPITALIZATION/REORGANIZATION.
(a) Any new, substituted or additional securities or other
property which is by reason of any Recapitalization distributed with
respect to the Purchased Shares shall be immediately subject to the
First Refusal Right, but only to the extent the Purchased Shares are
at the time covered by such right.
(b) In the event of a Reorganization, the First Refusal Right
shall remain in full force and effect and shall apply to the new
capital stock or other property received in exchange for the Purchased
Shares in consummation of the Reorganization, but only to the extent
the Purchased Shares are at the time covered by such right.
7. LAPSE. The First Refusal Right shall lapse upon the EARLIEST to
occur of (i) the first date on which shares of the Common Stock are held of
record by more than five hundred (500) persons, (ii) a determination made
by the Board that a public market exists for the outstanding shares of
Common Stock or (iii) a firm commitment underwritten public offering,
pursuant to an effective registration statement under the 1933 Act,
covering the offer and sale of the Common Stock in the aggregate amount of
at least fifty million dollars ($50,000,000). However, the Market Stand-Off
shall continue to remain in full force and effect following the lapse of
the First Refusal Right.
7.
F. SPECIAL TAX ELECTION
1. SECTION 83(b) ELECTION . Under Code Section 83, the excess of the
Fair Market Value of the Purchased Shares on the date any forfeiture
restrictions applicable to such shares lapse over the Purchase Price paid
for such shares will be reportable as ordinary income on the lapse date.
For this purpose, the term "forfeiture restrictions" includes the right of
the Corporation to repurchase the Purchased Shares pursuant to the
Repurchase Right. Participant may elect under Code Section 83(b) to be
taxed at the time the Purchased Shares are acquired, rather than when and
as such Purchased Shares cease to be subject to such forfeiture
restrictions. Such election must be filed with the Internal Revenue Service
within thirty (30) days after the date of this Agreement. Even if the Fair
Market Value of the Purchased Shares on the date of this Agreement equals
the Purchase Price paid (and thus no tax is payable), the election must be
made to avoid adverse tax consequences in the future.
THE FORM FOR MAKING THIS ELECTION IS ATTACHED AS EXHIBIT II HERETO.
PARTICIPANT UNDERSTANDS THAT FAILURE TO MAKE THIS FILING WITHIN THE
APPLICABLE THIRTY (30)-DAY PERIOD WILL RESULT IN THE RECOGNITION OF
ORDINARY INCOME AS THE FORFEITURE RESTRICTIONS LAPSE.
2. FILING RESPONSIBILITY. PARTICIPANT ACKNOWLEDGES THAT IT IS
PARTICIPANT'S SOLE RESPONSIBILITY, AND NOT THE CORPORATION'S, TO FILE A
TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF PARTICIPANT REQUESTS THE
CORPORATION OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS OR HER
BEHALF.
G. GENERAL PROVISIONS
1. ASSIGNMENT. The Corporation may assign the Repurchase Right and/or
the First Refusal Right to any person or entity selected by the Board,
including (without limitation) one or more stockholders of the Corporation.
2. AT WILL EMPLOYMENT. Nothing in this Agreement or in the Plan shall
confer upon Participant any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the
rights of the Corporation (or any Parent or Subsidiary employing or
retaining Participant) or of Participant, which rights are hereby expressly
reserved by each, to terminate Participant's Service at any time for any
reason, with or without cause.
3. NOTICES. Any notice required to be given under this Agreement shall
be in writing and shall be deemed effective upon personal delivery or upon
deposit in the U.S. mail, registered or certified, postage prepaid and
properly addressed to the party entitled to such notice at the address
indicated below such party's signature line on this Agreement or at such
other address as such party may designate by ten (10) days advance written
notice under this paragraph to all other parties to this Agreement.
8.
4. NO WAIVER. The failure of the Corporation in any instance to
exercise the Repurchase Right or the First Refusal Right shall not
constitute a waiver of any other repurchase rights and/or rights of first
refusal that may subsequently arise under the provisions of this Agreement
or any other agreement between the Corporation and Participant. No waiver
of any breach or condition of this Agreement shall be deemed to be a waiver
of any other or subsequent breach or condition, whether of like or
different nature.
5. CANCELLATION OF SHARES. If the Corporation shall make available, at
the time and place and in the amount and form provided in this Agreement,
the consideration for the Purchased Shares to be repurchased in accordance
with the provisions of this Agreement, then from and after such time, the
person from whom such shares are to be repurchased shall no longer have any
rights as a holder of such shares (other than the right to receive payment
of such consideration in accordance with this Agreement). Such shares shall
be deemed purchased in accordance with the applicable provisions hereof,
and the Corporation shall be deemed the owner and holder of such shares,
whether or not the certificates therefor have been delivered as required by
this Agreement.
H. MISCELLANEOUS PROVISIONS
1. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California
without resort to that State's conflict-of-laws rules.
2. PARTICIPANT UNDERTAKING. Participant hereby agrees to take
whatever additional action and execute whatever additional documents
the Corporation may deem necessary or advisable in order to carry out
or effect one or more of the obligations or restrictions imposed on
either Participant or the Purchased Shares pursuant to the provisions
of this Agreement.
3. AGREEMENT IS ENTIRE CONTRACT. This Agreement constitutes the
entire contract between the parties hereto with regard to the subject
matter hereof. This Agreement is made pursuant to the provisions of
the Plan and shall in all respects be construed in conformity with the
terms of the Plan.
4. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
5. SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall
inure to the benefit of, and be binding upon, the Corporation and its
successors and assigns and upon Participant, Participant's assigns and
the legal representatives, heirs and legatees of Participant's estate,
whether or not any such person shall have become a party to this
Agreement and have agreed in writing to join herein and be bound by
the terms hereof.
9.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the day and year first indicated above.
TRADEWEAVE, INC.
By:
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Title:
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Address:
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PARTICIPANT
Address:
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10.
APPENDIX
The following definitions shall be in effect under the Agreement:
A. AGREEMENT shall mean this Stock Issuance Agreement.
B. BOARD shall mean the Corporation's Board of Directors.
C. CODE shall mean the Internal Revenue Code of 1986, as amended.
D. COMMON STOCK shall mean the Corporation's common stock.
E. CHANGE IN CONTROL shall mean any of the following transactions
involving a change in control or ownership of the Corporation:
(i) a stockholder-approved merger or consolidation in which
securities possessing more than fifty percent (50%) of the total
combined voting power of the Corporation's outstanding securities
are transferred to a person or persons different from the persons
holding those securities immediately prior to such transaction,
or
(ii) a stockholder-approved sale, transfer or other
disposition of all or substantially all of the Corporation's
assets in complete liquidation or dissolution of the Corporation,
or
(iii) the acquisition, directly or indirectly, by any person
or related group of persons (other than the Corporation or a
person that directly or indirectly controls, is controlled by, or
is under common control with, the Corporation) of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities
Exchange Act of 1934, as amended) of securities possessing more
than fifty percent (50%) of the total combined voting power of
the Corporation's outstanding securities pursuant to a tender or
exchange offer made directly to the Corporation's stockholders.
F. CORPORATION shall mean Tradeweave, Inc., a Delaware corporation,
and any successor corporation to all or substantially all of the assets or
voting stock of Tradeweave, Inc. which shall by appropriate action adopt the
Plan.
G. DISPOSITION NOTICE shall have the meaning assigned to such term
in Paragraph E.2.
H. EXERCISE NOTICE shall have the meaning assigned to such term in
Paragraph E.3.
I. FAIR MARKET VALUE of a share of Common Stock on any relevant
date, prior to the initial public offering of the Common Stock, shall be
determined by the Plan Administrator after taking into account such factors
as it shall deem appropriate.
A-1.
J. FIRST REFUSAL RIGHT shall have the meaning assigned to such term in
Article E.
K. MARKET STAND-OFF shall mean the market stand-off restriction
specified in Paragraph C.4.
L. 1933 ACT shall mean the Securities Act of 1933, as amended.
M. OWNER shall mean Participant and all subsequent holders of the
Purchased Shares who derive their chain of ownership through a Permitted
Transfer from Participant.
N. PARENT shall mean any corporation (other than the Corporation)
in an unbroken chain of corporations ending with the Corporation, provided
each corporation in the unbroken chain (other than the Corporation) owns, at
the time of the determination, stock possessing fifty percent (50%) or more
of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
O. PARTICIPANT shall mean the person to whom shares are issued under
the Stock Issuance Program.
P. PERMITTED TRANSFER shall mean (i) a gratuitous transfer of the
Purchased Shares, PROVIDED AND ONLY IF Participant obtains the Corporation's
prior written consent to such transfer, (ii) a transfer of title to the
Purchased Shares effected pursuant to Participant's will or the laws of
inheritance following Participant's death or (iii) a transfer to the
Corporation in pledge as security for any purchase-money indebtedness
incurred by Participant in connection with the acquisition of the Purchased
Shares.
Q. PLAN shall mean the Corporation's 1999 Stock Option/Stock Issuance
Plan attached hereto as Exhibit III.
R. PLAN ADMINISTRATOR shall mean either the Board or a committee of
the Board acting in its capacity as administrator of the Plan.
S. PURCHASE PRICE shall have the meaning assigned to such term in
Paragraph A.1.
T. PURCHASED SHARES shall have the meaning assigned to such term in
Paragraph A.1.
U. QRS shall mean QRS Corporation, a Delaware corporation, which is
currently the Parent of the Corporation.
V. RECAPITALIZATION shall mean any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change
affecting the Corporation's outstanding Common Stock as a class without the
Corporation's receipt of consideration.
A-2.
W. REORGANIZATION shall mean any of the following transactions:
(i) a merger or consolidation in which the Corporation is not the
surviving entity,
(ii) a sale, transfer or other disposition of all or substantially all
of the Corporation's assets,
(iii) a reverse merger in which the Corporation is the surviving
entity but in which the Corporation's outstanding voting securities are
transferred in whole or in part to a person or persons different from the
persons holding those securities immediately prior to the merger, or
(iv) any transaction effected primarily to change the state in which
the Corporation is incorporated or to create a holding company structure.
X. REPURCHASE RIGHT shall mean the right granted to the Corporation in
accordance with Article D.
Y. SEC shall mean the Securities and Exchange Commission.
Z. SERVICE shall mean the Participant's performance of services for
the Corporation (or any Parent or Subsidiary) in the capacity of an employee,
subject to the control and direction of the employer entity as to both the
work to be performed and the manner and method of performance, a non-employee
member of the board of directors or an independent consultant.
AA. STOCK ISSUANCE PROGRAM shall mean the Stock Issuance Program under
the Plan.
AA. SUBSIDIARY shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in
the unbroken chain owns, at the time of the determination, stock possessing
fifty percent (50%) or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.
AB. TARGET SHARES shall have the meaning assigned to such term in
Paragraph E.2.
AC. VESTING SCHEDULE shall mean the vesting schedule specified in
Paragraph D.3 pursuant to which Participant is to vest in the Purchased
Shares in a series of installments over the Participant's period of Service.
AD. UNVESTED SHARES shall have the meaning assigned to such term in
Paragraph D.1.
A-3.
EXHIBIT INDEX
Exhibit I Assignment Separate From Certificate
Exhibit II Section 83(b) Tax Election
Exhibit III 1999 Stock Option/Stock Issuance Plan