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EXHIBIT 4.2
MUSTANG SOFTWARE, INC.
EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_____ Original Application
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)
1. ____________________ hereby elects to participate in each offering of
the Mustang Software, Inc. Employee Stock Purchase Plan (the "Plan")
beginning subsequent to the date set forth below and subscribes to
purchase shares of Common Stock of Mustang Software, Inc. (the
"Company") in accordance with this Agreement and the Plan.
2. I hereby authorize payroll deductions from each paycheck during each
offering period in the amount of _____% of my compensation (including
base pay and, to the extent applicable, any amounts attributable to
overtime, shift premium, incentive compensation, bonuses and
commissions) in accordance with the Plan.
3. I understand that said payroll deductions shall be accumulated for the
purchase of shares in accordance with the Plan, and that shares will
be purchased for me automatically at the end of each offering period
unless I withdraw from the Plan by giving written notice to the
Company. I authorize the Company to carry over in my account to the
next offering period any cash insufficient to purchase a share
of Common Stock.
4. I have received a copy of the Company's most recent prospectus which
describes the Plan and a copy of the complete "Mustang Software, Inc.
Employee Stock Purchase Plan". I understand that my participation in
the Plan is in all respects subject to the terms of the Plan.
5. Shares purchased for me under the Plan should be issued in the name(s)
of:
Address:__________________________________________________________
Social Security Number:___________________________________________
If you choose to include your spouse, you must designate below how you
wish your shares to be registered by checking the appropriate box. If
we receive no designation, the shares will be designated as joint
tenants.
[ ] Joint Tenants [ ] Community Property
[ ] Tenants in Common [ ] Tenants by Entirety
6. I understand that if I dispose of any shares received by me pursuant
to the Plan within 2 years after the Offering Date (the first day of
the offering period during which I purchased such shares) or within 1
year after the date on which such shares were transferred to me, I
will be treated for federal income tax purposes as having received
ordinary income at the time of such disposition in an amount equal to
the excess of the fair market value of the shares at the time such
shares were transferred to me over the price which I paid for the
shares. I hereby agree to notify the
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Company in writing within 30 days after the date of any such
disposition. However, if I dispose of such shares at any time after the
expiration of the 2-year and 1-year holding periods, I understand that
I will be treated for federal income tax purposes as having received
income only at the time of such disposition, and that such income will
be taxed as ordinary income only to the extent of an amount equal to
the lesser of (1) the excess of the fair market value of the shares at
the time of such disposition over the purchase price which I paid for
the shares under the option, or (2) the excess of the fair market value
of the shares over the option price, measured as if the option had been
exercised on the Offering Date. The remainder of the gain, if any,
recognized on such disposition will be taxed as capital gains.
7. I hereby agree to be bound by the terms of the Plan. The
effectiveness of this Subscription Agreement is dependent upon my
eligibility to participate in the Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Plan:
NAME: (Please Print) ___________________________________________________________________________
First Middle Last
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Relationship
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Address
NAME: (Please Print) ___________________________________________________________________________
First Middle Last
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Relationship
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Address
Date:________ _________________________________________
Signature of Employee
I do not wish to participate in the Employee Stock Purchase Plan.
Date:_________ _________________________________________
Signature of Employee