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Exhibit 10.20
Xxxx X. Xxxxxxx Options - Full Vesting in the Event of Acquisition
of the Company or Termination as a Director
Option Number B9601-006
CONCORD COMMUNICATIONS, INC.
Stock Option Agreement
Concord Communications, Inc., a Massachusetts corporation (the "Company"),
hereby grants this 1st day of 1996 to Xxxx Xxxxxxx (the "Employee") an Option
(the "Option") to purchase a maximum of 563,139 shares of its Common Stock, $.01
par value, at the price of .05 per share, on the following terms and conditions.
1. GRANT UNDER 1995 STOCK PLAN
This Option is granted pursuant to and is governed by the Company's
1995 Stock Plan (the "Plan") and, unless the context otherwise
requires, terms used herein shall have the same meaning as in the Plan.
Determinations made in connection with this Option pursuant to the Plan
shall be governed by the Plan as it exists on this date. In the event
of any inconsistency or conflict between this Agreement and the Plan,
the terms of the Plan shall govern.
2. OTHER OPTIONS
This option is in addition to any other Options heretofore or hereafter
granted to the Employee by the Company, but a duplicate original of
this instrument shall not effect the grant of another Option.
3. EXTENT OF OPTION IF EMPLOYMENT CONTINUES
If the Employee continues to be employed by the Company on the
following dates, the Employee may exercise this Option for the number
of shares set forth in the schedule below:
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Cumulative Cumulative
Shares Shares
Date Exercisable Date Exercisable
-------- ----------- -------- -----------
01/01/96 18,396 04/01/98 344,165
04/01/96 26,045 07/01/98 377,739
07/01/96 45,402 10/01/98 411,311
10/01/96 62,905 01/01/99 444,883
01/01/97 172,092 04/01/99 478,457
04/01/97 206,506 07/01/99 510,326
07/01/97 240,921 10/01/99 537,993
10/01/97 275,337 01/01/00 563,139
01/01/98 309,751
Provided, however, this Option shall become exercisable in full upon the first
to occur of the following:
(a) The consolidation or merger of the Company with or into any other
entity (other than a consolidation or merger in which the Company is
the continuing corporation and which does not result in any
reclassification of, or change in, the outstanding shares of the
capital stock of the Company), or a sale, conveyance, or disposition of
all or substantially all of the assets of the Company; and
(b) The time when the Employee shall cease to be a Director of the Company
other than by reason of death, disability or resignation.
The foregoing rights are cumulative and, while the Employee continues to be
employed by the Company, may be exercised up to and including the date which is
eight (8) years from the date this Option is granted. All of the foregoing
rights are subject to Sections 4 and 5 below, as appropriate, if the Employee
ceases to be employed by the Company or becomes disabled or dies while in the
employ of the Company.
If the Company becomes a party to a merger, consolidation, reorganization or
similar corporate transaction, the Company agrees to send written notice of such
event to the Employee. The Company agrees to request for the holders of
unexercised Options rights comparable to those granted under the 1995 Plan but
shall incur no liability for failure to secure such rights.
4. TERMINATION OF EMPLOYMENT
If the Employee ceases to be employed by the Company other than by
reason of death, this Option shall terminate after the passage of sixty
(60) days from the date employment ceases, but in no event later than
the scheduled expiration date. In such a case, the Employee's only
rights hereunder shall be those which are properly exercised before the
termination of this Option.
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5. DEATH OR DISABILITY
If the Employee dies while in the employ of the Company, this Option
may be exercised, to the extent of the number of shares with respect to
which the Employee could have exercised it on the date of his death, by
his estate, personal representative, or beneficiary to whom this Option
has been assigned pursuant to Article 10, at any time within 180 days
after the date of death, but not later than the scheduled expiration
date. If the Employee ceases to be employed by the Company by reason of
his disability (as defined in the Plan), this Option may be exercised
to the extent of the number of shares with respect to which he could
have exercised it on the date of the termination of his employment, at
any time within 180 days after such termination, but not later than the
scheduled expiration date. At the expiration of such 180 day period or
the scheduled expiration date, whichever is earlier, this Option shall
terminate and the only rights hereunder shall be those as to which the
Option was properly exercised before such termination.
6. PARTIAL EXERCISE
Exercise of this Option up to the extent above stated may be made in
part at any time and from time to time within the above limits, except
that this Option may not be exercised for a fraction of a share unless
such exercise is with respect to the final installment of stock subject
to this option and a fractional share (or cash in lieu thereof) must be
issued to permit the Employee to exercise completely such final
installment.
7. AGREEMENT TO PURCHASE FOR INVESTMENT
By acceptance of this Option, the Employee agrees that a purchase of
shares under this Option will not be made with a view to their
distribution, as that term is used in the Securities Act of 1933, as
amended, unless in the opinion of counsel to the Company such
distribution is in compliance with or exempt from the registration and
prospectus requirements of the Act, and the Employee agrees to sign a
certificate to such effect at the time of exercising this Option and
agrees that the certificate for the shares so purchased may be
inscribed with a legend to ensure compliance with the Act and with any
applicable state securities laws.
8. METHOD OF EXERCISING OPTION
Subject to the terms and conditions of this Agreement, this Option may
be exercised by written notice to the Company, at the principal
executive office of the Company, or to such transfer agent as the
Company shall designate. Such notice shall state the election to
exercise this Option and the number of shares in respect of which it is
being exercised and shall be signed by the person or persons so
exercising this Option. Such notice shall be accompanied by payment of
the full purchase price of such shares, and the Company shall deliver a
certificate or certificates representing such shares as soon as
practicable after the notice and payment have been received. The
certificate or certificates for the
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shares as to which this Option shall have been so exercised shall be
registered in the name of the person or persons so exercising this
Option (or, if this Option shall be exercised by the Employee and if
the Employee shall so request in the notice exercising this Option,
shall be registered in the name of the Employee and another person
jointly, with right of survivorship) and shall be delivered as provided
above to or upon the written order of the person or persons exercising
this Option. In the event this Option shall be exercised, pursuant to
Section 5 hereof, by any person or persons other than the Employee,
such notice shall be accompanied by appropriate proof of the right of
such person or persons to exercise this Option. All shares that shall
be purchased upon the exercise of this Option as provided herein shall
be fully paid and nonassessable.
9. OPTION NOT TRANSFERABLE
This Option is not transferable or assignable except by will or by the
laws of descent and distribution. During the Employee's lifetime,
only the Employee can exercise this Option.
10. NO OBLIGATION TO EXERCISE OPTION
The grant and acceptance of this Option imposes no obligation on the
Employee to exercise it.
11. NO OBLIGATION TO CONTINUE EMPLOYMENT
The Company is not by the Plan or this Option obligated to continue the
Employee in employment.
12. NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE
The Employee shall have no rights as a stockholder with respect to
shares subject to this Agreement until a stock certificate therefor has
been issued to the Employee and is fully paid for. Except as is
expressly provided in the Plan with respect to certain changes in the
capitalization of the Company, no adjustment shall be made for
dividends or similar rights for which the record date is prior to the
date such stock certificate is issued.
13. CAPITAL CHANGES AND BUSINESS SUCCESSIONS
It is the purpose of this Option to encourage the Employee to work for
the best interest of the Company and its stockholders. Since, for
example, that might require the issuance of a stock dividend or a
merger with another corporation, the purpose of this Option would not
be served if such a stock dividend, merger, or similar occurrence would
cause the Employee's rights hereunder to be diluted or terminated and
thus be contrary to the Employee's interest. The Plan contains
extensive provisions designed to preserve Options at full value in a
number of contingencies. Therefore, provisions in the Plan for
adjustments with respect to stock subject to Options and the related
provisions with
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respect to successors to the business of the Company are hereby made
applicable hereunder and are incorporated herein by reference. In
particular, without limiting the generality of the foregoing, it is
understood that for the purposes of Sections 3 and 5 hereof, both
inclusive, employment by the Company includes employment by a related
corporation as described in the Plan.
14. EARLY DISPOSITION
The Employee agrees to notify the Company of any disposition of any
shares of Common Stock acquired on the exercise of this Option within
the two year period beginning on the date of grant or within one year
after the date of the transfer of such shares to the Employee. The
Employee also agrees to provide the Company with any information which
it shall request concerning any such disposition. Employees who receive
incentive stock options will be disqualified under Section 422 of the
Code from receiving the favorable income tax treatment otherwise
available with respect to the exercise of such an Option if they
dispose of the stock received on exercise of the Option within either
of the one or two year periods described in the preceding sentence.
15. GOVERNING LAW
This Agreement shall be governed by and interpreted in accordance with
the internal laws of Massachusetts.
IN WITNESS WHEREOF the Company and the Employee have caused this instrument to
be executed, and the Employee whose signature appears below acknowledges receipt
of a copy of the Plan and acceptance of an original copy of this Agreement.
CONCORD COMMUNICATIONS, INC.
By: /s/
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/s/ Xxxx X. Xxxxxxx
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EMPLOYEE