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EXHIBIT 4.1
MUSTANG SOFTWARE, INC.
1994
INCENTIVE STOCK OPTION PLAN
AND
NONSTATUTORY STOCK OPTION PLAN
(As adopted December 12, 1994 and amended July 10, 1995)
1. NAME, EFFECTIVE DATE AND PURPOSE.
(a) This Plan document is intended to implement and
govern two separate stock option plans of MUSTANG SOFTWARE, INC., a California
corporation (the "Company"): the Incentive Stock Option Plan ("Plan A") and the
Nonstatutory Stock Option Plan ("Plan B"). Plan A provides for the granting of
options that are intended to qualify as incentive stock options ("Incentive
Stock Options") within the meaning of Section 422A(b) of the Internal Revenue
Code, as amended. Plan B provides for the granting of options that are not
intended to so qualify. Unless specified otherwise, all the provisions of this
Plan relate equally to both Plan A and Plan B and are condensed for convenience
into one Plan document.
(b) Plan A and Plan B are each established effective as
of December 12, 1994. The purpose of Plan A and Plan B (sometimes together
referred to as the "Plan" or this "Plan") is to promote the growth and general
prosperity of the Company and its Affiliated Companies. This Plan will permit
the Company to grant options ("Options") to purchase shares of its common stock
("Common Stock"). The granting of Options will help the Company attract and
retain the best available persons for positions of substantial responsibility
and will provide certain key employees with an additional incentive to
contribute to the success of the Company and its Affiliated Companies. For
purposes of this Plan, the term "Affiliated Companies" shall mean any component
member of a controlled group of corporations, as defined under Internal Revenue
Code Section 1563, in which the Company is also a component member.
2. ADMINISTRATION.
(a) The Plan shall be administered by the Board of
Directors of the Company (the "Board").
(b) The Board shall have sole authority, in its absolute
discretion, to determine which of the eligible persons of the Company and its
Affiliated Companies shall receive Options ("Optionees"), and, subject to the
express provisions and restrictions of this Plan, shall have sole authority, in
its absolute discretion, to determine the time when Options shall be granted,
the terms and conditions of an Option other than those terms and conditions
fixed under this Plan, the number of shares which may be issued upon exercise
of an Option and the means of payment for such shares,
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and shall have authority to do everything necessary or appropriate to
administer the Plan. All decisions, determinations and interpretations of the
Board shall be final and binding on all Optionees.
(c) The Board shall have the authority to delegate some
or all of the powers granted to it pursuant to this Section 2 to a committee
(the "Committee") appointed by the Board and consisting of not less than two
(2) members of the Board, one of whom shall be the Chief Executive Officer of
the Company. The Board may from time to time remove members from, or add
members to, the Committee, and vacancies on the Committee shall be filled by
the Board. All decisions, determinations and interpretations of the Committee
shall be final and binding on all Optionees, unless otherwise determined by the
Board.
(d) Definitions:
(i) Restricted Shareholder: An individual who,
at the time an Option is granted under either Plan A or Plan B, owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the employer corporation or of its Parent Corporation or Subsidiary
Corporation, with stock ownership to be determined in light of the attribution
rules set forth in Section 425(d) of the Internal Revenue Code.
(ii) Parent Corporation: A corporation as defined
in Section 425(e) of the Internal Revenue Code.
(iii) Subsidiary Corporation: A corporation as
defined in Section 425(f) of the Internal Revenue Code.
(iv) Officer: The chief executive officer,
president, chief financial officer, chief accounting officer, any vice
president in charge of a principal business function (such as sales,
administration, or finance) and any other person who performs similar
policy-making functions for the Company.
3. ELIGIBILITY.
(a) Plan A: The Board (or the Committee, if so
authorized by the Board) may, in its discretion, grant one or more Options
under Plan A to any key management employee of the Company or its Affiliated
Companies, including any employee who is a director of the Company or of any of
its Affiliated Companies presently existing or hereinafter organized or
acquired. Such Options may be granted to one or more such employees without
being granted to other eligible employees, as the Board may deem fit.
(b) Plan B: The Board (or the Committee, if so
authorized by the Board), may, in its discretion, grant one or more Options
under Plan B to any key management employee, any employee or non-employee
director of the Company or its Affiliated Companies, including any employee who
is a Director of the Company or of any of its Affiliated Companies presently
existing or hereinafter organized or acquired or any person who performs
consulting or other services for the
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Company or its Affiliated Companies and who is designated by the Board as
eligible to participate in Plan B. Such Options may be granted to one or more
such persons without being granted to other eligible persons, as the Board may
deem fit.
4. STOCK TO BE OPTIONED.
(a) The maximum aggregate number of shares which may be
optioned and sold under Plan A and Plan B is Four Hundred Forty- Four Thousand
(444,000) shares of authorized Common Stock of the Company. The foregoing
constitutes an absolute cumulative limitation on the total number of shares
that may be optioned under both Plan A and B. Therefore, at any particular date
the maximum aggregate number of shares which may be optioned under Plan A is
equal to Four Hundred Forty-Four Thousand (444,000) minus the number of shares
previously optioned under both Plan A and Plan B and the maximum aggregate
number of shares which may be optioned under Plan B is equal to Four Hundred
Forty-Four Thousand (444,000) minus the number of shares which have been
previously optioned under both Plan A and Plan B. All shares to be optioned and
sold under either Plan A or Plan B may be either authorized but unissued shares
or shares held in the treasury.
(b) Shares of Common Stock that: (i) are repurchased by
the Company after issuance hereunder pursuant to the exercise of an Option, or
(ii) are not purchased by the Optionee prior to the expiration or termination
of the applicable Option, shall again become available to be covered by Options
to be issued hereunder and shall not, as of the effective date of such
repurchase or expiration, be counted as covered by an outstanding Option for
purposes of the above-described maximum number of shares which may be optioned
hereunder.
5. OPTION PRICE.
The Option Price for shares of Common Stock to be issued under
either Plan A or Plan B shall be 100% of the fair market value of such shares
on the date on which the Option covering such shares is granted by the Board
(or the Committee, if authorized by the Board), except that if on the date on
which such Option is granted the Optionee is a Restricted Shareholder, than
such Option Price for Options granted under Plan A shall be 110% of the fair
market value of the shares of Common Stock subject to the Option on the date
such Option is granted by the Board (or the Committee, if so authorized). The
fair market value of shares of Common Stock for all purposes of this Plan is to
be determined by the Board (or the Committee, if so authorized by the Board) in
its sole discretion, exercised in good faith.
6. TERM OF PLAN.
Plan A and Plan B shall become effective on December 12, 1994;
both Plan A and Plan B shall continue in effect until December 12, 2004 unless
terminated earlier by action of the Board. No Option may be granted hereunder
after December 12, 2004.
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7. EXERCISE OF OPTION.
Subject to the actions, conditions and/or limitations set
forth in this Plan document and/or any applicable Stock Option Agreement
entered into hereunder, Options granted under this Plan shall be exercisable in
accordance with the following rules:
(a) No Option granted under Plan A may be exercised in
whole or in part until six (6) months after the date on which the Option is
granted by the Board, or by the Committee if so authorized (hereinafter the
"Option Grant Date").
(b) Subject to the specific provisions of this Section 7,
Options shall become exercisable at such times and in such installments (which
may be cumulative) as the Board shall provide in the terms of each individual
Option; provided, however, each Option granted under the Plan shall become
exercisable in installments of not less than 20% of the number of shares
covered by such Option each year from the Option Grant Date; and provided,
further, that by a resolution adopted after an Option is granted the Board may,
on such terms and conditions as it may determine to be appropriate and subject
to the specific provisions of this Section 7, accelerate the time at which such
Option or installment thereof may be exercised. For purposes of this Plan, any
accrued installment of an Option granted hereunder shall be referred to as an
"Accrued Installment."
(c) Subject to the specific restrictions contained in
this Section 7, an Option may be exercised when Accrued Installments accrue, as
provided in the terms under which such Option was granted, for a period of up
to ten (10) years from the Option Grant Date with respect to Options granted
under Plan A and for a period of up to ten (10) years from the Option Grant
Date with respect to Options granted under Plan B. In no event shall any Option
be exercised on or after the expiration of said maximum applicable period,
regardless of the circumstances then existing (including but not limited to the
death or termination of employment of the Optionee).
(d) The Board (or the Committee if so authorized by the
Board) shall fix the expiration date of the Option (the "Option Expiration
Date") at the time the Option grant is authorized.
8. RULES APPLICABLE TO CERTAIN DISPOSITIONS.
(a) Notwithstanding the foregoing provisions of Section
7, in the event the Company or the shareholders of the Company enter into an
agreement to dispose of all or substantially all of the assets or capital stock
of the Company by means of a sale, merger, consolidation, reorganization,
liquidation, or otherwise, an Option shall become immediately exercisable with
respect to the full number of shares subject to that Option during the period
commencing as of the later of (x) date of execution of such agreement or (y)
six (6) months after the Option Grant Date, and ending as of the earlier of:
(i) the Option Expiration Date; or
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(ii) the date on which the disposition of assets
or capital stock contemplated by the agreement is consummated. The exercise of
any Option that was made exercisable solely be reason of this Subsection 8(a)
shall be conditioned upon the consummation of the disposition of assets or
stock under the above referenced agreement. Upon the consummation of any such
disposition of assets or stock, this Plan and any unexercised Options issued
hereunder (or any unexercised portion thereof) shall terminate and cease to be
effective.
(b) Notwithstanding the foregoing, in the event that any
such agreement shall be terminated without consummating the disposition of said
stock or assets:
(i) any unexercised non-vested installments that
had become exercisable solely by reason of the provisions of Subsection 8(a)
shall again become non-vested and unexercisable as of said termination of such
agreement, and
(ii) the exercise of any option that had become
exercisable solely by reason of this Subsection 8(a) shall be deemed
ineffective and such installments shall again become non-vested and
unexercisable as of said termination of such agreement.
(c) Notwithstanding the provisions set forth in
Subsection 8(a), the Board (or the Committee, if so authorized by the Board)
may, at its election and subject to the approval of the corporation purchasing
or acquiring the stock or assets of the Company (the "surviving corporation"),
arrange for the Optionee to receive upon surrender of Optionee's Option a new
option covering shares of the surviving corporation in the same proportion, at
an equivalent option price and subject to the same terms and conditions as the
old Option. For purposes of the preceding sentence, the excess of the
aggregate fair market value of the shares subject to such new option
immediately after consummation of such disposition of stock or assets over the
aggregate option price of such shares of the surviving corporation shall not be
no more than the excess of the aggregate fair market value of all shares
subject to the old Option immediately before consummation of such disposition
of stock or assets over the aggregate Option Price of such shares of the
Company, and the new option shall not give the Optionee additional benefits
which such Optionee did not have under the old Option or deprive the Optionee
of benefits which the Optionee had under the old Option. If such substitution
of options is effectuated, the Optionee's rights under the old Option shall
thereupon terminate.
9. MERGERS AND ACQUISITIONS.
(a) If the Company at any time should succeed to the
business of another corporation through a merger or consolidation, or through
the acquisition of stock or assets of such corporation, Options may be granted
under the Plan to option holders of such corporation or its subsidiaries, in
substitution for options or rights to purchase stock of such corporation held
by them at the time of succession. The Board (or the Committee, if so
authorized by the Board) shall have sole and absolute discretion to determine
the extent to which such substitute Options shall be granted (if at all), the
person or persons within the eligible group to receive such substitute Options
(who need not be all option holders of such corporation), the number of Options
to be received by each such person, the Option Price of such Option, and the
terms and conditions of such substitute Options; provided, however, that the
terms and conditions of the substitute Options shall comply
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with the provisions of Section 425 of the Code, such that the excess of the
aggregate fair market value of the shares subject to such substitute Option
immediately after the substitution or assumption over the aggregate option
price of such shares is not more that the excess of the aggregate fair market
value of all shares subject to the substitute Option immediately before such
substitution or assumption over the aggregate option price of such shares, and
the substitute Option or the assumption of the old option does not give the
holder thereof additional benefits which he or she did not have under such old
option.
(b) Notwithstanding anything to the contrary herein, no
Option shall be granted, nor any action taken, permitted or omitted, which
could cause the Plan, or any Options granted hereunder as to which Rule 16b-3
under the Securities Exchange Act of 1934 may apply, not to comply with such
Rule.
10. TERMINATION OF EMPLOYMENT.
(a) In the event that the Optionee's employment,
directorship or consulting or other arrangement with the Company (or Affiliated
Company) is terminated for any reason other than death or disability, any
unexercised Accrued installments of the Option granted hereunder to such
terminated Optionee shall expire and become unexercisable as of the earlier of:
(i) the applicable Option Expiration Date; or
(ii) a date 30 days after such termination occurs,
provided however, that the Board (or the Committee if empowered to so act) may,
in the exercise of its discretion, extend said date up to and including a date
three months following such termination, with respect to Options granted under
Plan A, or up to and including a date two years following such termination with
respect to Options granted under Plan B.
(b) In the event that the Optionee's employment,
directorship or consulting or other arrangement with the Company is terminated
due to the death or disability of the Optionee, any unexercised Accrued
Installments of the Option granted hereunder to such Optionee shall expire and
become unexercisable as of the earlier of:
(i) the applicable Option Expiration Date; or
(ii) the first anniversary of the date of death of
such Optionee (if applicable); or
(iii) the first anniversary of the date of the
termination of employment, directorship or consulting or other arrangement by
reason of disability (if applicable). Any such Accrued Installments of a
deceased Optionee may be exercised prior to their expiration by (and only by)
the person or persons to whom the Optionee's Option right shall pass by will or
by the laws of descent and distribution, if applicable, subject, however, to
all of the terms and conditions of this Plan and the applicable Stock Option
Agreement governing the exercise of Options granted hereunder.
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(c) For purposes of this Section 10, an Optionee shall be
deemed employed by the Company (or affiliated Company) during any period of
leave of absence from active employment as authorized by the Company (or
Affiliated Company).
11. EXERCISE OF OPTIONS.
(a) An Option shall be deemed exercised when written
notice of such exercise has been given to the Company at its principal business
office by the person entitled to exercise the Option and full payment in cash
or cash equivalents (or with shares of Common Stock pursuant to Section 14) for
the shares with respect to which the Option is exercised has been received by
the Company. The Board of Directors (or the Committee) may cause the Company
to give or arrange for financial assistance (including without limitation
direct loans, with or without interest, secured or unsecured, or guarantees of
third party loans) to an Optionee for the purpose of providing funds for the
purchase of shares pursuant to the exercise of Options, when in the judgment of
the Board (or the Committee) such assistance may reasonably be expected to be
in the best interests of the Company, and consistent with the Articles of
Incorporation and Bylaws of the Company and applicable laws, and will permit
the shares to be fully paid and nonassessable when issued.
(b) An Option may be exercised in accordance with this
Section 11 as to all or any portion of the shares covered by any Accrued
Installment of the Option from time to time during the applicable Option
period, but shall not be exercisable with respect to fractions of a share.
(c) As soon as practicable after any proper exercise of
an Option in accordance with the provisions of this Plan, the Company shall,
without charging transfer or issue tax to the Optionee, deliver to the Optionee
at the main office of the Company, or such other place as shall be mutually
acceptable, a certificate or certificates representing the shares of Common
Stock as to which the Option has been exercised. The time of issuance and
delivery of the Common Stock may be postponed by the Company for such period as
may, be required for it with reasonable diligence to comply with any applicable
listing requirements of any national or regional securities exchange and any
law or regulation applicable to the issuance and delivery of such shares.
12. AUTHORIZATION TO ISSUE OPTIONS AND SHAREHOLDER APPROVAL.
Unless in the judgment of counsel to the Company such permit
is not necessary with respect to particular grants, Options granted under the
Plan shall be conditioned upon the Company obtaining any required permit from
the California Department of Corporations and/or other appropriate governmental
agencies, free of any conditions not acceptable to the Board, authorizing the
Company to grant such Options, provided, however, such condition shall lapse as
of the effective date of issuance of such permit(s) in a form to which the
Company does not object within sixty (60) days. The grant of Options under the
Plan also is conditioned on approval of the Plan by the vote or consent of the
holders of a majority of the outstanding shares of the Company's Common Stock
and no Option granted hereunder shall be effective or exercisable unless and
until the Plan has been so approved.
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13. LIMIT ON VALUE OF OPTIONED SHARES.
The aggregate fair market value (determined as of the Option
Grant Date) of the shares of Common Stock to which Options granted under Plan A
are exercisable for the first time by any employee of the Company during any
calendar year under all incentive stock option plans of the Company and its
Affiliated Companies shall not exceed $100,000. The limitation imposed by this
Section 13 shall not apply with respect to Options granted under Plan B.
14. PAYMENT OF EXERCISE PRICE WITH COMPANY STOCK.
The Board (or the Committee, if so authorized) may provide
that, upon exercise of the Option, the Optionee may elect to pay for all or
some of the shares of Common Stock underlying the Option with shares of Common
Stock of the Company previously acquired and owned at the time of exercise by
the Optionee, subject to all restrictions and limitations of applicable laws,
rules and regulations, including Section 425(c)(3) of the Internal Revenue
Code, and provided that the Optionee will make representations and warranties
satisfactory to the Company regarding his or her title to the shares used to
effect the purchase, including without limitation representations and
warranties that the Optionee has good and marketable title to such shares free
and clear of any and all liens, encumbrances, charges, equities, claims,
security interests, options or restrictions and has full power to deliver such
shares without obtaining the consent or approval of any person or governmental
authority other than those which have already given consent or approval in a
form satisfactory to the Company. The equivalent dollar value of the shares
used to effect the purchase shall be the fair market value of the shares on the
date of the purchase as determined by the Board (or the Committee, if so
authorized) in its sole discretion, exercised in good faith.
The terms and conditions of Options granted under the Plan
shall be evidenced by a Stock Option Agreement (hereinafter referred to as the
'Agreement') executed by the Company and the person to whom the Option is
granted. Each agreement shall contain the following provisions:
(a) A provision fixing the number of shares which may be
issued upon exercise of the Option;
(b) A provision establishing the Option exercise price
per share;
(c) A provision establishing the times and the
installments in which Options may be exercised, provided, however, such times
and installments shall not be less than 20% of the number of shares covered by
such Option each year from the Option Grant Date;
(d) A provision incorporating therein this Plan by
reference;
(e) A provision clarifying which Options are intended to
be Incentive Stock Options under Plan A and which are intended to be
nonstatutory stock options under Plan B;
(f) A provision fixing the maximum duration of the Option
as not more than ten (10) years from the Option Grant Date for Options granted
under either Plan A or Plan B;
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(g) Such representations and warranties by the Optionee
as may be required by Section 25 of this Plan or as may be required by the
Board (or the Committee) in its discretion;
(h) Any other restriction (in addition to those
established under this Plan) as may be established by the Board (or the
Committee) with respect to the exercise of the Option, the transfer of the
Option, and/or the transfer of the shares purchased by exercise of the Option,
provided that such restrictions are not in conflict with this Plan; and
(i) Such other terms and conditions not inconsistent with
this Plan as may be established by the Board (or the Committee).
15. TAXES, FEES AND EXPENSES.
The Company shall pay all original issue and transfer taxes
(but not income taxes, if any) with respect to the grant of Options and/or the
issue and transfer of shares pursuant to the exercise of such Options, and all
other fees and expenses necessarily incurred by the Company in connection
therewith, and will from time to time use its best efforts to comply with all
laws and regulations which, in the opinion of counsel for the Company, shall be
applicable thereto.
16. WITHHOLDING OF TAXES.
The grant of Options hereunder and the issuance of Common
Stock pursuant to the exercise of such Options is conditioned upon the
Company's reservation of the right to withhold, in accordance with any
applicable law, from any compensation payable to the Optionee any taxes
required to be withheld by federal, state or local law as a result of the grant
or exercise of any such Option.
17. AMENDMENT OR TERMINATION OF THE PLAN.
(a) The Board may amend this Plan from time to time in
such respects as the Board may deem advisable, provided, however, that no such
amendment shall operate to (i) affect adversely an Optionee's rights under this
Plan with respect to any Option granted hereunder prior to the adoption of such
amendment, except as may be necessary, in the judgment of counsel to the
Company, to comply with any applicable law, (ii) increase the maximum aggregate
number of shares which may be optioned and sold under the Plan (unless
shareholders approve such increase), (iii) change the manner of determining the
Option exercise price, (iv) change the classes of persons eligible to receive
Options under the Plan, or (v) extend the maximum duration of the Option or the
Plan.
(b) The Board may at any time terminate this Plan. Any
such termination of the Plan shall not, without the written consent of the
Optionee, alter the terms of Options already granted and such Options shall
remain in full force and effect as if this Plan had not been terminated.
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18. OPTIONS NOT TRANSFERABLE.
Options granted under this Plan may not be sold, pledged,
hypothecated, assigned, encumbered, gifted or otherwise transferred or
alienated in any manner, either voluntarily or involuntarily by operation of
law, otherwise than by will or the laws of descent of distribution, and may be
exercised during the lifetime of an Optionee only by such Optionee.
19. NO RESTRICTIONS ON TRANSFER OF STOCK.
Common Stock issued pursuant to the exercise of an Option
granted under this Plan (hereinafter "Optioned Stock"), or any interest in such
Optioned Stock, may be sold, assigned, gifted, pledged, hypothecated,
encumbered or otherwise transferred or alienated in any manner by the holder(s)
thereof, subject, however, to any representations or warranties requested under
Section 25 of this Plan and also subject to compliance with any applicable
federal, state or other local law, regulation or rule governing the sale or
transfer of stock or securities.
20. RESERVATION OF SHARES OF COMMON STOCK.
The Company, during the term of this Plan, will at all times
reserve and keep available such number of shares of its Common Stock as shall
be sufficient to satisfy the requirements of the Plan.
21. RESTRICTIONS ON ISSUANCE OF SHARES.
The Company, during the term of this Plan, will use its best
efforts to seek to obtain from the appropriate regulatory agencies any
requisite authorization in order to grant Options or issue and sell such number
of shares of its Common Stock as shall be sufficient to satisfy the
requirements of the Plan. The inability of the Company to obtain from any such
regulatory agency having jurisdiction thereof the authorization deemed by the
Company's counsel to be necessary to the lawful grant of Options or the
issuance and sale of any shares of its stock hereunder or the inability of the
Company to confirm to its satisfaction that any grant of Options or issuance
and sale of any shares of such stock will meet applicable legal requirements
shall relieve the Company of any liability in respect of the non-issuance or
sale of such stock as to which such authorization or confirmation have not been
obtained.
22. NOTICES.
Any notice to be given to the Company pursuant to the
provisions of this Plan shall be addressed to the Company in care of its
Secretary at its principal office, and any notice to be given to a person to
whom an Option is granted hereunder shall be addressed to him or her at the
address given beneath his or her signature on his or her Stock Option
Agreement, or at such other address as such person or his or her transferee
(upon the transfer of Optioned Stock) may hereafter designate in writing to the
Company. Any such notice shall be deemed duly given when enclosed in a
properly sealed envelope or wrapper addressed as aforesaid, registered or
certified, and deposited, postage and
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registry or certification fee prepaid, in a post office or branch post office
regularly maintained by the United States Postal Service. It shall be the
obligation of each Optionee and each transferee holding Optioned Stock to
provide the Secretary of the Company, by letter mailed as provided hereinabove,
with written notice of his or her correct mailing address.
23. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
If the outstanding shares of Common Stock of the Company are
increased, decreased, changed into or exchanged for a different number or kind
of shares of the Company through reorganization, recapitalization,
reclassification, stock dividend, stock split or reverse stock split, then an
appropriate and proportionate adjustment shall be made in the number or kind of
shares which may be issued upon exercise of Options granted under the Plan;
provided, however that no such adjustment need be made if, upon the advice of
counsel, the Board determines that such adjustment may result in the receipt of
federally taxable income to holders of Options granted hereunder or the holders
of Common Stock or other classes of the Company's securities.
24. REPRESENTATIONS AND WARRANTIES.
As a condition to the grant of any Option hereunder or the
exercise of any portion of an Option, the Company may require the person to be
granted or exercising such Option to make any representation and/or warranty to
the Company as may, in the judgment of counsel to the Company, be required
under any applicable law or regulation, including, but not limited to, a
representation and warranty that the Option and/or shares issuable or issued
upon exercise of such Option are being acquired only for investment, for such
person's own account and without any present intention to sell or distribute
such Option or shares, as the case may be, if, in the opinion of counsel for
the Company, such representation is required under the Securities Act of 1933,
the California Corporate Securities Law of 1968 or any other applicable law,
regulation or rule of any governmental agency.
25. NO ENLARGEMENT OF EMPLOYEE RIGHTS.
This Plan is purely voluntary on the part of the Company, and
while the Company hopes to continue it indefinitely, the continuance of the
Plan shall not be deemed to constitute a contract between the Company and any
employee, or to be consideration for or a condition of the employment of any
employee. Nothing contained in the Plan shall be deemed to give any employee
the right to be retained in the employ of the Company or its Affiliated
Companies, or to interfere with the right of the Company or an Affiliated
Company to discharge or retire any employee thereof at any time. No employee
shall have any right to or interest in Options authorized hereunder prior to
the grant of such an Option to such employee, and upon such grant he or she
shall have only such rights and interests as are expressly provided herein,
subject, however, to all applicable provisions of the Company's Articles of
Incorporation, as the same may be amended from time to time.
26. INFORMATION TO OPTION HOLDERS.
During the period any options granted to employees of the
Company remain outstanding, such employee-option holders shall be entitled to
receive, on an annual or other periodic
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basis, financial and other information regarding the Company. The Board (or
the Committee, if so authorized) shall exercise its discretion with regard to
the nature and extent of the financial information so provided, giving due
regard to the size and circumstances of the Company and, if the Company
provides annual reports to its shareholders, the Company's practice in
connection with such annual reports. Notwithstanding the above, if the
issuance of options under either Plan A or Plan B is limited to key employees
whose duties in connection with the Company assure their access to equivalent
information, this Section 27 shall not apply to such employees and plan.
27. LEGENDS ON STOCK CERTIFICATES.
Each certificate representing Common Stock issued under this
Plan shall bear whatever legends are required by federal or state law or by any
governmental agency. In particular, unless an appropriate registration
statement is filed pursuant to the federal Securities Act of 1933, as amended,
with respect to the shares of Common Stock issuable under this Plan, each
certificate representing such Common Stock shall be endorsed on its face with
the following legend or its equivalent:
"Neither the Option pursuant to which the shares represented
by this certificate are issued nor said shares have been
registered under the Securities Act of 1933, as amended (the
"Act"). Transfer or sale of such securities or any interest
therein is unlawful except after registration, or pursuant to
an exemption from the registration requirements, as provided
in the Act and the regulations thereunder."
A copy of this Plan shall be delivered to the Secretary of the
Company and shall be shown by him or her to each eligible person making
reasonable inquiry concerning it. A copy of this Plan also shall be delivered
to each Optionee at the time his or her Options are granted.
28. SPECIFIC PERFORMANCE.
The Options granted under this Plan and the Optioned Stock
issued pursuant to the exercise of such Options cannot be readily purchased or
sold in the open market, and, for that reason among others, the Company and its
shareholders will be irreparably damaged in the event that this Plan is not
specifically enforced. In the event of any controversy concerning the right or
obligation to purchase or sell any such Option or Optioned Stock, such right or
obligation shall be enforceable in a court of equity by a decree of a specific
performance. Such remedy shall, however, be cumulative and not exclusive, and
shall be in addition to any other remedy which the parties may have.
29. INVALID PROVISION.
In the event that any provision of this Plan is found to be
invalid or otherwise unenforceable under any applicable law, such invalidity or
unenforceability shall not be construed as rendering any other provisions
contained herein invalid or unenforceable, and all such other
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provisions shall be given full force and effect to the same extent as though
the invalid or unenforceable provision was not contained herein.
30. APPLICABLE LAW.
This Plan shall be governed by and construed and enforced in
accordance with the laws of the State of California.
31. SUCCESSORS AND ASSIGNS.
This Plan shall be binding on and inure to the benefit of the
Company and the employees to whom an Option is granted hereunder, and such
employees' heirs, executors, administrators, legatees, personal
representatives, assignees and transferees.
IN WITNESS WHEREOF, pursuant to the due authorization and adoption of
this plan by the Board on December 12, 1994 and its subsequent amendment by the
Board on July 10, 1995, the Company has caused this Plan to be duly executed
by its duly authorized officer.
MUSTANG SOFTWARE, INC.
BY:__________________________
James A. Harrer
President, Chief Executive Officer and
Chairman of the Board
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