| OPTIONHOLDER
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| PARAMETRIC TECHNOLOGY CORPORATION
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| By:
| /s/ Xxxxxxx X. Xxxxxx
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| By:
| /s/ Xxxxx X. Xxxxxx
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| Optionholder
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| Executive Vice President - CFO
PARAMETRIC TECHNOLOGY CORPORATION 1997 INCENTIVE STOCK
OPTION PLAN
Nonstatutory Stock Option Terms And
Conditions
1.
Plan Incorporated by Reference. This
Option is issued pursuant to the terms of the Plan and may be amended as
provided in the Plan. Capitalized terms used and not otherwise defined in
this certificate have the meanings given to them in the Plan. This
certificate does not set forth all of the terms and conditions of the Plan,
which are incorporated herein by reference. The Committee administers the
Plan and its determinations regarding the operation of the Plan are final
and binding. Copies of the Plan may be obtained upon written request without
charge from the Corporate Counsel of the Company.
2.
Option Price. The price to be paid for
each share of Common Stock issued upon exercise of the whole or any part of
this Option is the Option Price set forth on the face of this
certificate.
3.
Exercisability Schedule. This Option
may be exercised at any time and from time to time for the number of shares
and in accordance with the exercisability schedule set forth on the face of
this certificate, but only for the purchase of whole shares. This Option may
not be exercised as to any shares after the Expiration Date.
4.
Method of Exercise. To exercise this
Option, the Optionholder shall deliver written notice of exercise to the
Company specifying the number of shares with respect to which the Option is
being exercised accompanied by payment of the Option Price for such shares
in cash, by certified check or in such other form, including shares of
Common Stock of the Company valued at their Fair Market Value on the date of
delivery or a payment commitment of a financial or brokerage institution, as
the Committee may approve. Promptly following such notice, the Company will
deliver to the Optionholder a certificate representing the number of shares
with respect to which the Option is being exercised.
5.
No Right To Employment. No person
shall have any claim or right to be granted an Option. Each employee of the
Company or any of its Affiliates is an employee-at-will (that is to say that
either the Participant or the Company or any Affiliate may terminate the
employment relationship at any time for any reason or no reason at all)
unless, and only to the extent, provided in a written employment agreement
for a specified term executed by the chief executive officer of the Company
or his duly authorized designee or the authorized signatory of any
Affiliate. Neither the adoption, maintenance, nor operation of the Plan nor
any Option hereunder shall confer upon any employee of the Company or of any
Affiliate any right with respect to the continuance of his/her employment by
the Company or any such Affiliate nor shall they interfere with the right of
the Company (or Affiliate) to terminate any employee at any time or
otherwise change the terms of employment, including, without limitation, the
right to promote, demote or otherwise re-assign any employee from one
position to another within the Company or any Affiliate.
6.
Effect of Grant. Participant shall not
earn any Options granted hereunder until such time as all the conditions put
forth herein and in the Plan which are required to be met in order to
exercise the Option have been fully satisfied.
7.
Recapitalization, Mergers, Etc. As
provided in the Plan, in the event of corporate transactions affecting the
Company's outstanding Common Stock, the number and kind of shares subject to
this Option and the exercise price hereunder shall be equitably adjusted. If
such transaction involves a consolidation or merger of the Company with
another entity, the sale or exchange of all or substantially all of the
assets of the Company or a reorganization or liquidation of the Company,
then in lieu of the foregoing, the Committee may upon written notice to the
Optionholder provide that this Option shall terminate on a date not less
than 20 days after the date of such notice unless theretofore exercised. In
connection with such notice, the Committee may in its discretion accelerate
or waive any deferred exercise period.
8.
Option Not Transferable. This Option
is not transferable by the Optionholder otherwise than by will or the laws
of descent and distribution, and is exercisable, during the Optionholder's
lifetime, only by the Optionholder. The naming of a Designated Beneficiary
does not constitute a transfer.
9.
Termination of Employment or
Engagement. If the Optionholder's status as an employee or consultant of
(a) the Company, (b) an Affiliate, or (c) a corporation (or parent or
subsidiary corporation of such corporation) issuing or
assuming a stock option in a transaction to which section 424(a) of the Code
applies, is terminated for any reason (voluntary or involuntary) and the
period of exercisability for a particular Option following such termination
has not been specified by the Board, each such Option then held by that
Participant shall expire to the extent not previously exercised ten (10)
calendar days after such Participant's employment or engagement is
terminated, except that-
(a) If
the Participant is on military, sick leave or other bona fide
leave of absence (such as temporary employment by the federal government),
his or her employment or engagement with the Company will be treated as
continuing intact if the period of such leave does not exceed ninety (90)
days, or, if longer, so long as the Participant's right to reemployment or
the survival of his or her service arrangement with the Company is
guaranteed either by statute or by contract; otherwise, the Participant's
employment or engagement will be deemed to have terminated on the 91st day
of such leave.
(b) If
the Participant's employment is terminated by reason of his or her
retirement from the Company at normal retirement age, each Option then held
by the Participant, to the extent exercisable at retirement, may be
exercised by the Participant at any time within three (3) months after such
retirement unless terminated earlier by its terms.
(c) If
the Participant's employment or engagement is terminated by reason of his or
her death, each Option then held by the Participant, to the extent
exercisable at the date of death, may be exercised at any time within one
year after that date (unless terminated earlier by its terms) by the
person(s) to whom the Participant's option rights pass by will or by the
applicable laws of descent and distribution.
(d) If
the Participant's employment or engagement is terminated by reason of his or
her becoming permanently and totally disabled, each Option then held by the
Participant, to the extent exercisable upon the occurrence of permanent and
total disability, may be exercised by the Participant at any time within one
(1) year after such occurrence unless terminated earlier by its terms. For
purposes hereof, an individual shall be deemed to be "permanently and
totally disabled" if he or she 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. Any determination of permanent and total disability shall be made in
good faith by the Company on the basis of a report signed by a qualified
physician.
10.
Compliance with Securities Laws. It
shall be a condition to the Optionholder's right to purchase shares of
Common Stock hereunder that the Company may, in its discretion, require (a)
that the shares of Common Stock reserved for issuance upon the exercise of
this Option shall have been duly listed, upon official notice of issuance,
upon any national securities exchange or automated quotation system on which
the Company's Common Stock may then be listed or quoted, (b) that either (i)
a registration statement under the Securities Act of 1933 with respect to
the shares shall be in effect, or (ii) in the opinion of counsel for the
Company, the proposed purchase shall be exempt from registration under that
Act and the Optionholder shall have made such undertakings and agreements
with the Company as the Company may reasonably require, and (c) that such
other steps, if any, as counsel for the Company shall consider necessary to
comply with any law applicable to the issue of such shares by the Company
shall have been taken by the Company or the Optionholder, or both. The
certificates representing the shares purchased under this Option may contain
such legends as counsel for the Company shall consider necessary to comply
with any applicable law.
11.
Payment of Taxes. The Optionholder
shall pay to the Company, or make provision satisfactory to the Company for
payment of, any taxes required by law to be withheld with respect to the
exercise of this Option. The Committee may, in its discretion, require any
other Federal or state taxes imposed on the sale of the shares to be paid by
the Optionholder. In the Committee's discretion, such tax obligations may be
paid in whole or in part in shares of Common Stock, including shares
retained from the exercise of this Option, valued at their Fair Market Value
on the date of delivery. The Company and its Affiliates may, to the extent
permitted by law, deduct any such tax obligations from any payment of any
kind otherwise due to the Optionholder.
Adopted
November 14, 1996
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