EXHIBIT 4.09
TSI INTERNATIONAL SOFTWARE LTD.
NONQUALIFIED STOCK OPTION AGREEMENT
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This Stock Option Agreement (this "AGREEMENT") is made and entered
into as of the Date of Grant set forth below (the "DATE OF GRANT") by and
between TSI International Software Ltd., a Delaware corporation (the "COMPANY"),
and the Optionee named below ("OPTIONEE").
OPTIONEE:
SOCIAL SECURITY NUMBER:
OPTIONEE'S ADDRESS:
TOTAL OPTION SHARES:
EXERCISE PRICE PER SHARE:
DATE OF GRANT:
VESTING START DATE:
EXPIRATION DATE:
1. GRANT OF OPTION. The Company hereby grants to Optionee a
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nonqualified stock option (this "OPTION") to purchase up to the total number of
shares of Common Stock of the Company set forth above as Total Option Shares
(collectively, the "SHARES") at the Exercise Price Per Share set forth above
(the "EXERCISE PRICE"), subject to all of the terms and conditions of this
Agreement. Capitalized terms not defined herein shall have the meanings
ascribed to them in the Company's 1997 Equity Incentive Plan, as adopted May 8,
1997 and as may be amended in accordance with its terms.
2. VESTING; EXERCISE PERIOD.
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2.1 Vesting of Right to Exercise Option. This Option shall
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become vested and exercisable as to portions of the Shares as follows: (a) this
Option shall not vest nor be exercisable with respect to any of the Shares until
____________ (the "FIRST VESTING DATE"); (b) if Optionee has continuously
provided services to the Company or any Subsidiary or Parent of the Company from
the Date of Grant through the First Vesting Date and has not been Terminated on
or before the First Vesting Date, then on the First Vesting Date this Option
shall vest and become exercisable as to twenty five percent (25%) of the Shares;
and (c) thereafter on the first day of each month, so long as Optionee
continuously provides services to the Company or any Subsidiary or Parent of the
Company and is not Terminated, this Option shall vest and become exercisable as
to an additional 1/48th (0.02833333) of the Shares; provided that this Option
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shall in no event ever vest and become exercisable with respect to more than
100% of the Shares.
TSI International Software Ltd.
Nonqualified Stock Option
Agreement
2.2 Expiration. This Option shall expire on the Expiration
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Date set forth above and must be exercised, if at all, on or before the earlier
of the Expiration Date or the date on which this Option is earlier terminated in
accordance with the provisions of Section 3 below.
3. TERMINATION.
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3.1 Termination for Any Reason Except Death, Disability or
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Cause. If Optionee is Terminated for any reason, except Optionee's death,
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Disability or Cause, then this Option, to the extent (and only to the extent)
that it would have been exercisable by Optionee on the date of Termination, may
be exercised by Optionee no later than three (3) months after the date of
Termination, but in any event no later than the Expiration Date.
3.2 Termination Because of Death or Disability. If Optionee
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is Terminated because of the death or Disability of Optionee (or if Optionee
dies within three (3) months following Termination other than for Cause or
because of Optionee's Disability), then this Option, to the extent that it is
exercisable by Optionee on the date of Termination, may be exercised by Optionee
(or Optionee's legal representative or authorized assignee) no later than twelve
(12) months after the date of Termination, but in any event no later than the
Expiration Date.
3.3 Termination for Cause. If Optionee is determined by the
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Board of Directors of the Company (the "BOARD") to have committed an act of
theft, embezzlement, fraud, dishonesty, or a breach of fiduciary duty to the
Company or its Parent or Subsidiary ("CAUSE"), this Option shall expire on the
date of Termination.
3.4 No Obligation to Employ. Nothing in this Agreement shall
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confer on Optionee any right to continue in the employ of, or other relationship
with, the Company or any Parent or Subsidiary of the Company, or limit in any
way the right of the Company or any Parent or Subsidiary of the Company to
terminate Optionee's employment or other relationship at any time, with or
without Cause.
4. MANNER OF EXERCISE.
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4.1 Stock Option Exercise Agreement. To exercise this
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Option, Optionee (or in the case of exercise after Optionee's death, Optionee's
executor, administrator, heir or legatee, as the case may be) must deliver to
the Company an executed stock option exercise agreement in the form attached
hereto as Exhibit A, or in such other form as may be approved by the Company
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from time to time (the "EXERCISE AGREEMENT"), which shall set forth, inter alia,
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Optionee's election to exercise this Option, the number of Shares being
purchased, any restrictions imposed on the Shares and any representations,
warranties and agreements regarding Optionee's investment intent and access to
information as may be required by the Company to comply with applicable
securities laws. If someone other than Optionee exercises this Option, then
such person must submit documentation reasonably acceptable to the Company that
such person has the right to exercise this Option.
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TSI International Software Ltd.
Nonqualified Stock Option
Agreement
4.2 Limitations on Exercise. This Option may not be
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exercised unless such exercise is in compliance with all applicable federal and
state securities laws, as they are in effect on the date of exercise. This
Option may not be exercised as to fewer than 100 Shares unless it is exercised
as to all Shares as to which this Option is then exercisable.
4.3 Payment. The Exercise Agreement shall be accompanied by
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full payment of the Exercise Price for the Shares being purchased in cash (by
check), or where permitted by law:
(a) by cancellation of indebtedness of the Company to the Optionee;
(b) by surrender of shares of the Company's Common Stock that: (1) either
(A) have been owned by Optionee for more than six (6) months and have
been paid for within the meaning of SEC Rule 144 (and, if such shares
were purchased from the Company by use of a promissory note, such note
has been fully paid with respect to such shares); or (B) were obtained
by Optionee in the open public market; and (2) are clear of all liens,
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claims, encumbrances or security interests;
(c) by waiver of compensation due or accrued to Optionee for services
rendered;
(d) provided that a public market for the Company's stock exists: (1)
through a "same day sale" commitment from Optionee and a broker-dealer
that is a member of the National Association of Securities Dealers (an
"NASD DEALER") whereby Optionee irrevocably elects to exercise this
Option and to sell a portion of the Shares so purchased to pay for the
exercise price and whereby the NASD Dealer irrevocably commits upon
receipt of such Shares to forward the exercise price directly to the
Company; or (2) through a "margin" commitment from Optionee and a NASD
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Dealer whereby Optionee irrevocably elects to exercise this Option and
to pledge the Shares so purchased to the NASD Dealer in a margin
account as security for a loan from the NASD Dealer in the amount of
the exercise price, and whereby the NASD Dealer irrevocably commits
upon receipt of such Shares to forward the exercise price directly to
the Company; or
(e) by any combination of the foregoing.
4.4 Tax Withholding. Prior to the issuance of the Shares
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upon exercise of this Option, Optionee must pay or provide for any applicable
federal or state withholding obligations of the Company. If the Compensation
Committee of the Board (the "COMMITTEE") permits, Optionee may provide for
payment of withholding taxes upon exercise of this Option by requesting that the
Company retain Shares with a Fair Market Value equal to the minimum amount of
taxes required to be withheld. In such case, the Company shall issue the net
number of Shares to the Optionee by deducting the Shares retained from the
Shares issuable upon exercise.
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TSI International Software Ltd.
Nonqualified Stock Option
Agreement
4.5 Issuance of Shares. Provided that the Exercise Agreement
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and payment are in form and substance satisfactory to counsel for the Company,
the Company shall issue the Shares registered in the name of Optionee,
Optionee's authorized assignee, or Optionee's legal representative, and shall
deliver certificates representing the Shares with the appropriate legends
affixed thereto.
5. COMPLIANCE WITH LAWS AND REGULATIONS. The exercise of this Option
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and the issuance and transfer of Shares shall be subject to compliance by the
Company and Optionee with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange on
which the Company's Common Stock may be listed at the time of such issuance or
transfer. Optionee understands that the Company is under no obligation to
register or qualify the Shares with the SEC, any state securities commission or
any stock exchange to effect such compliance.
6. NONTRANSFERABILITY OF OPTION. This Option may not be transferred
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in any manner other than by will or by the laws of descent and distribution and
may be exercised during the lifetime of Optionee only by Optionee. The terms of
this Option shall be binding upon the executors, administrators, successors and
assigns of Optionee.
7. TAX CONSEQUENCES. Set forth below is a brief summary as of the
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Date of Grant of some of the federal tax consequences of exercise of this Option
and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE
TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. OPTIONEE SHOULD CONSULT A TAX
ADVISOR BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
7.1 Exercise of Nonqualified Stock Option. There may be a
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regular federal income tax liability upon the exercise of this Option. Optionee
will be treated as having received compensation income (taxable at ordinary
income tax rates) equal to the excess, if any, of the fair market value of the
Shares on the date of exercise over the Exercise Price. The Company will be
required to withhold from Optionee's compensation or collect from Optionee and
pay to the applicable taxing authorities an amount equal to a percentage of this
compensation income at the time of exercise.
7.3 Disposition of Shares. If the Shares are held for more
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than twelve (12) months after the date of the transfer of the Shares pursuant to
the exercise of this Option then any gain realized on disposition of the Shares
will be treated as long term capital gain for federal income tax purposes.
8. PRIVILEGES OF STOCK OWNERSHIP. Optionee shall not have any of the
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rights of a stockholder with respect to any Shares until Optionee exercises this
Option and pays the Exercise Price.
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TSI International Software Ltd.
Nonqualified Stock Option
Agreement
9. MODIFICATION, EXTENSION AND RENEWAL. The Committee shall have the
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power to modify, extend or renew this Option and to authorize the grant of new
Options in substitution therefor, provided that any such action may not, without
the written consent of the Optionee, impair any rights under any option
previously granted.
10. ADJUSTMENT OF OPTION SHARES. In the event that the number of
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outstanding shares of Common Stock of the Company is changed by a stock
dividend, recapitalization, stock split, reverse stock split, subdivision,
combination, reclassification or similar change in the capital structure of the
Company without consideration, then the Exercise Price and number of Shares
subject to this Option will be proportionately adjusted, subject to any required
action by the Board or the stockholders of the Company and compliance with
applicable securities laws; provided however, that fractions of a Share will not
be issued but will either be replaced by a cash payment equal to the Fair Market
Value of such fraction of a Share or will be rounded up to the nearest whole
Share, as determined by the Committee.
11. CORPORATE TRANSACTIONS.
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11.1 Assumption or Replacement of Awards by Successor. In the
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event of
(a) a dissolution or liquidation of the Company;
(b) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation with a wholly-owned
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subsidiary, a reincorporation of the Company in a different jurisdiction, or
other transaction in which there is no substantial change in the stockholders of
the Company or their relative stock holdings and this Option is assumed,
converted or replaced by the surviving corporation, which assumption will be
binding on the Optionee);
(c) a merger in which the Company is the surviving corporation but
after which the stockholders of the Company immediately prior to such merger
(other than any stockholder that merges with the Company in such merger, or
which owns or controls another corporation that merges, with the Company in such
merger) cease to own their shares or other equity interest in the Company;
(d) the sale of all or substantially all of the assets of the Company;
or
(e) the acquisition, sale or transfer of more than 50% of the
outstanding shares of the Company by tender offer or similar transaction;
this Option will automatically vest for one additional year and may also be
assumed, converted or replaced by the surviving corporation (if any), which
assumption, conversion or replacement will be binding on the Optionee. The
Committee may also, in its sole discretion, provide for additional accelerated
vesting of this Option. In lieu of assuming, converting or replacing this
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TSI International Software Ltd.
Nonqualified Stock Option
Agreement
Option, the surviving corporation may substitute an equivalent equity incentive
award or provide substantially similar consideration to the Optionee as was
provided to stockholders (after taking into account the existing provisions of
this Option and the one year additional vesting). The surviving corporation may
also issue, in place of outstanding Shares of the Company held by the Optionee,
substantially similar shares or other property subject to repurchase
restrictions no less favorable to the Optionee. In the event such surviving
corporation (if any) refuses to assume or substitute this Option, as provided
above, pursuant to a transaction described in this Subsection 11.1, this Option
will automatically vest for one additional year and will expire on such
transaction at such time and on such conditions as the Committee will determine,
provided, however, that the Committee may, in its sole discretion, provide for
additional accelerated vesting of this Option. If this Option is so accelerated
and is not exercised prior to the consummation of the corporate transaction, it
shall terminate.
11.2 Other Treatment of Equity Awards. Subject to any
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greater rights granted to the Optionee under the foregoing provisions of this
Section 11, in the event of the occurrence of any transaction described in
Section 11.1, this Option will be treated as provided in the applicable
agreement or plan of merger, consolidation, dissolution, liquidation, sale of
assets or other "corporate transaction."
12. INTERPRETATION. Any dispute regarding the interpretation of this
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Agreement shall be submitted by Optionee or the Company to the Committee for
review. The resolution of such a dispute by the Committee shall be final and
binding on the Company and Optionee.
13. ENTIRE AGREEMENT. This Agreement and the Exercise Agreement
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constitute the entire agreement and understanding of the parties hereto with
respect to the subject matter hereof and supersede all prior understandings and
agreements with respect to such subject matter.
14. NOTICES. Any notice required to be given or delivered to the
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Company under the terms of this Agreement shall be in writing and addressed to
the Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Optionee shall be in writing and
addressed to Optionee at the address indicated above or to such other address as
such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon: personal
delivery; three (3) days after deposit in the United States mail by certified or
registered mail (return receipt requested); one (1) business day after deposit
with any return receipt express courier (prepaid); or one (1) business day after
transmission by facsimile.
15. SUCCESSORS AND ASSIGNS. The Company may assign any of its rights
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under this Agreement. This Agreement shall be binding upon and inure to the
benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer set forth herein, this Agreement shall be binding upon
Optionee and Optionee's heirs, executors, administrators, legal representatives,
successors and assigns.
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TSI International Software Ltd.
Nonqualified Stock Option
Agreement
16. GOVERNING LAW. This Agreement shall be governed by and construed
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in accordance with the internal laws of the State of Connecticut, without regard
to that body of law pertaining to choice of law or conflict of law.
17. ACCEPTANCE. Optionee hereby acknowledges receipt of a copy of
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this Agreement. Optionee has read and understands the terms and provisions
thereof, and accepts this Option subject to all the terms and conditions of this
Agreement. Optionee acknowledges that there may be adverse tax consequences
upon exercise of this Option or disposition of the Shares and that the Company
has advised Optionee to consult a tax advisor prior to such exercise or
disposition.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
in duplicate by its duly authorized representative and Optionee has executed
this Agreement in duplicate as of the Date of Grant.
TSI INTERNATIONAL SOFTWARE LTD. OPTIONEE
By:
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(Signature)
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(Please print name)
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(Please print title)
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EXHIBIT A
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STOCK OPTION EXERCISE AGREEMENT
(not filed)
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