Exhibit 99.14
QRS CORPORATION
NON-EMPLOYEE DIRECTOR AUTOMATIC STOCK OPTION AGREEMENT
RECITALS
A. The Corporation has approved an automatic option grant
program under the 1993 Stock Option/Stock Issuance Plan (the "Plan") pursuant to
which the non-employee members of the Corporation's Board of Directors (the
"Board") will automatically receive periodic option grants designed to reward
them for services they have rendered to the Corporation and to encourage them to
continue in the service of the Corporation.
B. Optionee is a non-employee member of the Board and this
Agreement is executed pursuant to, and is intended to carry out the purposes of,
the Plan in connection with the automatic grant of a stock option to purchase
shares of the Corporation's common stock ("Common Stock") under the Plan.
C. The granted option is intended to be a non-statutory option
which does not meet the requirements of Section 422 of the Internal Revenue
Code.
NOW, THEREFORE, it is hereby agreed as follows:
1. Grant of Option. Subject to and upon the terms and
conditions set forth in this Agreement, there is hereby granted to Optionee, as
of the date of grant (the "Grant Date") specified in the accompanying Notice of
Grant of Non-Employee Director Automatic Stock Option (the "Grant Notice"), a
stock option to purchase up to that number of shares of Common Stock (the
"Option Shares") as is specified in the Grant Notice. The Option Shares shall be
purchasable from time to time during the option term at the price per share (the
"Option Price") specified in the Grant Notice.
2. Option Term. This option shall have a maximum term of ten
(10) years measured from the Grant Date and shall expire at the close of
business on the Expiration Date specified in the Grant Notice, unless sooner
terminated in accordance with Paragraph 5, 7 or 8 of this Agreement.
3. Limited Transferability. This option may, in connection
with Optionee's estate plan, be assigned in whole or in part during Optionee's
lifetime to one or more members of Optionee's immediate family or to a trust
established for the exclusive benefit of Optionee and/or one or more such family
members. The assigned portion shall be exercisable only by the person or persons
who acquire a proprietary interest in the option pursuant to such assignment.
The terms applicable to the assigned portion shall be the same as those in
effect for this option immediately
prior to such assignment. Should Optionee die while holding this option, then
this option shall be transferred in accordance with Optionee's will or the laws
of descent and distribution.
4. Dates of Exercise. This option shall become exercisable in
a series of successive annual installments as specified in the Grant Notice. As
the option becomes exercisable for one or more installments, those installments
shall accumulate, and the option shall remain exercisable for the accumulated
installments until the expiration or sooner termination of the option term. In
no event shall this option become exercisable for any additional Option Shares
following Optionee's cessation of service as a Board member.
5. Cessation of Board Service. Should Optionee's service as a
Board member cease while this option remains outstanding, then the option term
specified in Paragraph 2 shall terminate (and this option shall cease to be
outstanding) prior to the Expiration Date in accordance with the following
provisions:
(i) Should Optionee cease to serve as a Board member for any
reason (other than death or permanent disability) while holding this
option, then the period for exercising this option shall be reduced to
a six (6)-month period commencing with the date of such cessation of
Board service, but in no event shall this option be exercisable at any
time after the Expiration Date. During such limited period of
exercisability, this option may not be exercised for more than the
number of Option Shares (if any) for which such option is exercisable
on the date of Optionee's cessation of Board service. Upon the
expiration of such six (6)-month period, the option shall terminate and
cease to be outstanding.
(ii) Should Optionee die during the six (6)-month period
following his or her cessation of Board service, then the personal
representative of Optionee's estate or the person or persons to whom
the option is transferred pursuant to Optionee's will or in accordance
with the laws of descent and distribution shall have the right to
exercise this option for any or all of the Option Shares for which the
option is exercisable at the time of Optionee's cessation of Board
service (less any Option Shares purchased by Optionee after his or her
cessation of Board service but prior to death). Such right of exercise
shall terminate, and this option shall accordingly cease to be
outstanding, upon the earlier of (A) the expiration of the twelve
(12)-month period measured from the date of Optionee's death or (B) the
specified Expiration Date of the option term.
(iii) Should Optionee die or become permanently disabled while
serving as a Board member, then this option shall accelerate in full
and Optionee, or the personal representative of Optionee's estate or
the person or persons to whom the option is transferred pursuant to
Optionee's will or in accordance with the laws of descent and
distribution, shall have the right to exercise this option for
2.
any or all of the Option Shares subject to this option at the time of
Optionee's cessation of Board service. Such right of exercise shall
terminate, and this option shall accordingly cease to be outstanding,
upon the earlier of (A) the expiration of the twelve (12)-month period
measured from the date on which Optionee dies or becomes permanently
disabled or (B) the specified Expiration Date of the option term.
(iv) Upon Optionee's cessation of Board service for any
reason other than death or permanent disability, this option shall
immediately terminate and cease to be outstanding with respect to any
and all Option Shares for which such option is not otherwise at that
time exercisable in accordance with the normal exercise provisions of
Paragraph 4 or the special acceleration provisions of Paragraph 7 or 8.
(iv) Optionee shall be deemed to be permanently disabled if
Optionee is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment
which can be expected to result in death or which has lasted or can be
expected to last for a continuous period of not less than twelve (12)
months.
6. Adjustment in Option Shares.
A. Should any change be made to the Common Stock issuable
under the Plan by reason of any stock split, stock dividend, combination of
shares, exchange of shares or other change affecting such Common Stock as a
class without the Corporation's receipt of consideration, then the number and
class of securities purchasable under this option and the Option Price payable
per share shall be appropriately adjusted to prevent the dilution or enlargement
of Optionee's rights hereunder; provided, however, the aggregate Option Price
shall remain the same.
B. Should this option be assumed in connection with a
Corporate Transaction under Paragraph 7, then the option shall, immediately
after such Corporate Transaction, be appropriately adjusted to apply and pertain
to the number and class of securities which would have been issued to Optionee
in the consummation of such Corporate Transaction had the option been exercised
immediately prior to such Corporate Transaction. Appropriate adjustments shall
also be made to the Option Price payable per share, provided the aggregate
Option Price payable hereunder shall remain the same.
7. Corporate Transaction. In the event of any of the following
stockholder-approved transactions to which the Corporation is a party (a
"Corporate Transaction"):
3.
(i) a merger or consolidation in which the Corporation is
not the surviving entity, except for a transaction the principal
purpose of which is to change the State in which the Corporation is
incorporated,
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation in liquidation or
dissolution of the Corporation, or
(iii) any reverse merger in which the Corporation is the
surviving entity but in which securities possessing more than fifty
percent (50%) of the total combined voting power of the Corporation's
outstanding securities are transferred to person or persons different
from those who held such securities immediately prior to such merger,
this option, to the extent outstanding at such time but not
otherwise fully exercisable, shall automatically accelerate so that such option
shall, immediately prior to the specified effective date for the Corporate
Transaction, become fully exercisable for all of the Option Shares at the time
subject to this option and may be exercised for all or any portion of such
shares as fully-vested shares of Common Stock. Immediately following the
consummation of the Corporate Transaction, this option shall terminate and cease
to be outstanding, except to the extent the option is expressly assumed by the
successor corporation or parent thereof.
8. Change in Control/Hostile Takeover.
(a) This option, to the extent outstanding at the time of a
Change in Control (as defined below) but not otherwise fully exercisable, shall
automatically accelerate so that this option shall, immediately prior to the
effective date of such Change in Control, become fully exercisable for all of
the Option Shares at the time subject to this option and may be exercised for
all or any portion of such shares as fully-vested shares of Common Stock. This
option as so accelerated shall remain exercisable until the earliest to occur of
(i) the specified Expiration Date of the option term, (ii) the sooner
termination of this option in accordance with Paragraph 5 or 7 or (iii) the
surrender of this option under Paragraph 8(b).
(b) Optionee shall have an unconditional right, exercisable
during the thirty (30)-day period immediately following the consummation of a
Hostile Take-Over, to surrender this option to the Corporation in exchange for a
cash distribution from the Corporation in an amount equal to the excess of (I)
the Take-Over Price of the Option Shares at the time subject to the surrendered
option (whether or not the option is otherwise at the time exercisable for such
shares) over (II) the aggregate Option Price payable for such shares.
To exercise this limited stock appreciation right, Optionee
must, during the applicable thirty (30)-day exercise period, provide the
Corporation with written notice of the option surrender
4.
in which there is specified the number of Option Shares as to which the Option
is being surrendered. Such notice must be accompanied with the return of
Optionee's copy of this Agreement, together with any written amendments to such
Agreement. The cash distribution shall be paid to Optionee within five (5) days
following such delivery date, and neither the approval of the Plan Administrator
nor the consent of the Board shall be required in connection with such option
surrender and cash distribution. Upon receipt of such cash distribution, this
option shall be cancelled with respect to the shares subject to the surrendered
option (or the surrendered portion), and Optionee shall cease to have any
further right to acquire those Option Shares under this Agreement. In the event
this option is surrendered for only a portion of the Option Shares at the time
subject to such option, the Corporation shall issue a new stock option agreement
(substantially in the form of this Agreement) for the balance of the Option
Shares for which this option is not surrendered.
This limited stock appreciation right shall in all events
terminate upon the expiration or sooner termination of the option term and may
not be assigned or transferred by Optionee.
(c) Definitions: For purposes of this Agreement, the following
definitional provisions shall be in effect:
A Change in Control shall be deemed to occur in the event:
(i) 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)
directly or indirectly acquires beneficial ownership (within the
meaning of Rule 13d-3 of the Securities Exchange Act of 1934 (the "1934
Act")) 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, or
(ii) there is a change in the composition of the Board over a
period of thirty-six (36) consecutive months or less such that a
majority of the Board members ceases, by reason of one or more proxy
contests for the election of Board members, to be comprised of
individuals who either (A) have been Board members continuously since
the beginning of such period or (B) have been elected or nominated for
election as Board members during such period by at least a majority of
the Board members described in clause (A) who were still in office at
the time such election or nomination was approved by the Board.
A Hostile Take-Over shall be deemed to occur in the event (i)
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) directly or indirectly
acquires beneficial ownership (within the meaning
5.
of Rule 13d-3 of the 1934 Act) 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 which the
Board does not recommend the Corporation's shareholders to accept.
The Take-Over Price per share shall be deemed to be equal to
the greater of (a) the Fair Market Value per share of Common Stock on
the option surrender date, as determined in accordance with the
valuation provisions of Paragraph 9(b), or (b) the highest reported
price per share of Common Stock paid by the tender offeror in effecting
the Hostile Take-Over.
9. Manner of Exercising Option.
(a) In order to exercise this option for all or any part of
the Option Shares for which the option is at the time exercisable, Optionee (or
in the case of exercise after Optionee's death, Optionee's executor,
administrator, heir or legatee, as the case may be) must take the following
actions:
(i) Provide the Secretary of the Corporation with written
notice of the option exercise (the "Exercise Notice"), in substantially
the form of Exhibit I attached hereto, in which there is specified the
number of Option Shares to be purchased under the exercised option.
(ii) Pay the aggregate Option Price for the purchased shares
in one of the following alternative forms:
1. full payment in cash or check made payable to the
Corporation's order; or
2. full payment in shares of Common Stock held by
Optionee for the requisite period necessary to avoid a charge to
the Corporation's reported earnings and valued at Fair Market
Value on the Exercise Date; or
3. full payment in a combination of shares of Common
Stock held for the requisite period necessary to avoid a charge to
the Corporation's earnings for financial reporting purposes and
valued at Fair Market Value on the Exercise Date and cash or check
made payable to the Corporation's order; or
4. full payment effected through a broker-dealer sale
and remittance procedure pursuant to which Optionee
6.
shall provide irrevocable written instructions (A) to a
Corporation-designated brokerage firm to effect the immediate sale
of the purchased shares and remit to the Corporation, out of the
sale proceeds available on the settlement date, sufficient funds
to cover the aggregate Option Price payable for the purchased
shares and (B) to the Corporation to deliver the certificates for
the purchased shares directly to such brokerage firm in order to
complete the sale.
(iii) Furnish to the Corporation appropriate documentation
that the person or persons exercising the option (if other than
Optionee) have the right to exercise this option.
(b) For purposes of subparagraph 9(a) above and for all other
valuation purposes under this Agreement, the Fair Market Value per share of
Common Stock on any relevant date shall be the determined in accordance with the
following provisions:
(i) If the Common Stock is not at the time listed or
admitted to trading on any national stock exchange but is traded on the
Nasdaq National Market, the Fair Market Value shall be the closing
selling price per share on the date in question, as such price is
reported by the National Association of Securities Dealers on the
Nasdaq National Market or any successor system. If there is no reported
closing selling price for the Common Stock on the date in question,
then the closing selling price on the last preceding date for which
such quotation exists shall be determinative of Fair Market Value.
(ii) If the Common Stock is at the time listed or admitted to
trading on any national stock exchange, then the Fair Market Value
shall be the closing selling price per share on the date in question on
the exchange determined by the Plan Administrator to be the primary
market for the Common Stock, as such price is officially quoted in the
composite tape of transactions on such exchange. If there is no
reported sale of Common Stock on such exchange on the date in question,
then the Fair Market Value shall be the closing selling price on the
exchange on the last preceding date for which such quotation exists.
(c) The Exercise Date shall be the date on which the Exercise
Notice is delivered to the Secretary of the Corporation. Except to the extent
the sale and remittance procedure specified above is utilized in connection with
the option exercise, payment of the Option Price for the purchased shares must
accompany such notice.
(d) As soon as practical after the Exercise Date, the
Corporation shall issue to or on behalf of Optionee (or other person or persons
exercising this option) a certificate or certificates representing the purchased
Option Shares.
7.
(e) In no event may this option be exercised for any
fractional share.
10. Stockholder Rights. The holder of this option shall not
have any of the rights of a stockholder with respect to the Option Shares until
such individual shall have exercised this option and paid the Option Price for
the purchased shares.
11. No Impairment of Rights. This Agreement shall not in any
way affect the right of the Corporation to adjust, reclassify, reorganize or
otherwise make changes in its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its
business or assets. Nor shall this Agreement in any way be construed or
interpreted so as to affect adversely or otherwise impair the right of the
Corporation or the stockholders to remove Optionee from the Board at any time in
accordance with the provisions of applicable law.
12. Compliance with Laws and Regulations. The exercise of this
option and the issuance of the Option Shares upon such exercise shall be subject
to compliance by the Corporation and Optionee with all applicable requirements
of law relating thereto and with all applicable regulations of any stock
exchange (or the Nasdaq National Market, if applicable) on which shares of the
Common Stock may be listed for trading at the time of such exercise and
issuance.
13. Successors and Assigns. Except to the extent otherwise
provided in Paragraph 3 or 7, the provisions of this Agreement shall inure to
the benefit of, and be binding upon, the successors, administrators, heirs,
legal representatives and assigns of Optionee and the successors and assigns of
the Corporation.
14. Discharge of Liability. The inability of the Corporation
to obtain approval from any regulatory body having authority deemed by the
Corporation to be necessary to the lawful issuance and sale of any Common Stock
pursuant to this option shall relieve the Corporation of any liability with
respect to the non-issuance or sale of the Common Stock as to which such
approval shall not have been obtained. However, the Corporation shall use its
best efforts to obtain all such applicable approvals.
15. Notices. Any notice required to be given or delivered to
the Corporation under the terms of this Agreement shall be in writing and
addressed to the Corporation in care of the Corporate Secretary at the Corporate
Offices at 0000 Xxxxxx Xxx Xxxxx, Xxxxxxxx, XX 00000. Any notice required to be
given or delivered to Optionee shall be in writing and addressed to Optionee at
the address indicated below Optionee's signature line on the Grant Notice. All
notices shall be deemed to have been given or delivered upon personal delivery
or upon deposit in the U.S. mail, postage prepaid and properly addressed to the
party to be notified.
16. Construction/Governing Law. This Agreement and the option
evidenced hereby are made and granted pursuant to the Plan and are in all
respects limited by and subject to
8.
the express terms and provisions of the Plan, including the automatic option
grant provisions of Article Three of the Plan. The interpretation, performance,
and enforcement of this Agreement shall be governed by the laws of the State of
California without resort to that State's conflict-of-laws rules.
9.
EXHIBIT I
NOTICE OF EXERCISE OF
NONSTATUTORY STOCK OPTION
I hereby notify QRS Corporation (the "Corporation") that I
elect to purchase shares of Common Stock of the Corporation (the "Purchased
Shares") pursuant to that certain option (the "Option") granted to me on
___________, 199__ to purchase up to __________ shares of the Corporation's
Common Stock at an option price of $ per share (the "Exercise Price").
Concurrently with the delivery of this Exercise Notice to the
Secretary of the Corporation, I shall hereby pay to the Corporation the Exercise
Price for the Purchased Shares in accordance with the provisions of my agreement
with the Corporation evidencing the Option and shall deliver whatever additional
documents may be required by such agreement as a condition for exercise.
Alternatively, I may utilize the special broker/dealer sale and remittance
procedure specified in my agreement to effect payment of the Exercise Price for
the Purchased Shares.
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Date Optionee
Address:
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Print name in exact manner
it is to appear on the
stock certificate:
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Address to which certificate
is to be sent, if different
from address above:
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Social Security Number:
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