-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RPZHt8ivJl6LHpr6ewmzFpvN7SiWRubtWFFCNltu8TOYkKWYwvu75hjjZAkyCX7D UrqALRPVQBg/qrC78YsTdA== 0001021408-01-502703.txt : 20010628 0001021408-01-502703.hdr.sgml : 20010628 ACCESSION NUMBER: 0001021408-01-502703 CONFORMED SUBMISSION TYPE: SC TO-I PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 20010627 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: ANSWERTHINK INC CENTRAL INDEX KEY: 0001057379 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 650750100 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC TO-I SEC ACT: SEC FILE NUMBER: 005-55547 FILM NUMBER: 1668940 BUSINESS ADDRESS: STREET 1: 1001 BRICKELL BAY DRIVE STREET 2: SUITE 3000 CITY: MIAMI STATE: FL ZIP: 33131 BUSINESS PHONE: 3053758005 MAIL ADDRESS: STREET 1: 1001 BRICKELL BAY DRIVE STREET 2: SUITE 3000 CITY: MIAMI STATE: FL ZIP: 33131 FORMER COMPANY: FORMER CONFORMED NAME: ANSWERTHINK CONSULTING GROUP INC DATE OF NAME CHANGE: 19980608 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ANSWERTHINK INC CENTRAL INDEX KEY: 0001057379 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 650750100 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC TO-I BUSINESS ADDRESS: STREET 1: 1001 BRICKELL BAY DRIVE STREET 2: SUITE 3000 CITY: MIAMI STATE: FL ZIP: 33131 BUSINESS PHONE: 3053758005 MAIL ADDRESS: STREET 1: 1001 BRICKELL BAY DRIVE STREET 2: SUITE 3000 CITY: MIAMI STATE: FL ZIP: 33131 FORMER COMPANY: FORMER CONFORMED NAME: ANSWERTHINK CONSULTING GROUP INC DATE OF NAME CHANGE: 19980608 SC TO-I 1 dsctoi.txt SCHEDULE TI ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________ SCHEDULE TO (Rule 13e-4) TENDER OFFER STATEMENT UNDER SECTION 13(e)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 __________________ ANSWERTHINK, INC. (Name of Subject Company (Issuer)) __________________ Nonqualified Options to Purchase Shares of Common Stock, Par Value $.001 Per Share, and Incentive Stock Options to Purchase Shares of Common Stock, Par Value $.001 Per Share, Having an Exercise Price of $10.00 Per Share or More, Granted Under Answerthink, Inc. 1998 Stock Option and Incentive Plan, Think New Ideas, Inc. Amended and Restated 1997 Stock Option Plan and Think New Ideas, Inc. Amended and Restated 1998 Stock Option Plan (Title of Class of Securities) __________________ 036916 10 4 (CUSIP Number of Class of Securities) (Underlying Common Stock) __________________ Frank A. Zomerfeld, Esq. Corporate Counsel Answerthink, Inc. 1001 Brickell Bay Drive Suite 3000 Miami, Florida 33131 (305) 375-8005 (Name, address and telephone number of person authorized to receive notices and communications on behalf of filing person) Copy to: James E. Showen, Esq. Hogan & Hartson L.L.P. 555 Thirteenth St., N.W. Washington, D.C. 20004-1109 (202) 637-5600 CALCULATION OF FILING FEE - -------------------------------------------------------------------------------- Transaction valuation* Amount of filing fee* - -------------------------------------------------------------------------------- $55,278,146.00 $11,055.63 - -------------------------------------------------------------------------------- * Calculated solely for purposes of determining the filing fee. This amount assumes that options to purchase 8,234,334 shares of common stock of Answerthink, Inc., having an aggregate value of $55,278,146.00 as of June 22, 2001, will be exchanged pursuant to this offer. The aggregate value of such options was calculated based on the Black-Scholes option pricing model. The amount of the filing fee, calculated in accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended, equals 1/50th of one percent of the value of the transaction. [_] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. Amount Previously Paid: Not applicable. Filing party: Not applicable. Form or Registration No.: Not applicable. Date filed: Not applicable. [_] Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. Check the appropriate boxes below to designate any transactions to which the statement relates: [_] third party tender offer subject to Rule 14d-1. [X] issuer tender offer subject to Rule 13e-4. [_] going-private transaction subject to Rule 13e-3. [_] amendment to Schedule 13D under Rule 13d-2. Check the following box if the filing is a final amendment reporting the results of the tender offer. [_] Item 1. Summary Term Sheet. The information set forth under "Summary Term Sheet" in the Offer to Exchange, dated June 27, 2001 (the "Offer to Exchange"), attached hereto as Exhibit (a)(1), is incorporated herein by reference. Item 2. Subject Company Information. (a) The name of the issuer is Answerthink, Inc., a Florida Corporation, (the "Company"), and the address of its principal executive offices is 1001 Brickell Bay Drive, Suite 3000, Miami, Florida, 33131. The information set forth in the Offer to Exchange under Section 9 ("Information Concerning Answerthink") is incorporated herein by reference. (b) This Tender Offer Statement on Schedule TO relates to an offer by the Company to exchange (i) nonqualified options to purchase shares of the Company's common stock, par value $.001 per share (the "Common Stock"), that were granted under the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Answerthink Option Plan") or the Think New Ideas, Inc. Amended and Restated 1997 Stock Option (the "Think New Ideas 1997 Option Plan") or the Think New Ideas, Inc. Amended and Restated 1998 Stock Option Plan (the Think New Ideas 1998 Option Plan and, together with the Answerthink Option Plan and the Think New Ideas 1997 Option Plan, the "Plans") and (ii) incentive stock options to purchase shares of Common Stock that have an exercise price of $10.00 per share or more that were granted under the Plans for new options to purchase shares of Common Stock to be granted under the Answerthink Option Plan, upon the terms and subject to the conditions described in the Offer to Exchange and the related Letter of Transmittal (the "Letter of Transmittal" and, together with the Offer to Exchange, as they may be amended from time to time, the "Offer"), attached hereto as Exhibits (a)(1) and (a)(2). The Offer is being made to option holders who are employees or directors of the Company. If all eligible options are tendered and accepted for exchange pursuant to the terms of the Offer, the total number of shares of Common Stock subject to the new options will be 8,234,334. The information set forth in the Offer to Exchange under "Summary Term Sheet," Section 1 ("Eligibility; Number of Options; Expiration Date"), Section 5 ("Acceptance of Options for Exchange and Issuance of New Options") and Section 8 ("Source and Amount of Consideration; Terms of New Options") is incorporated herein by reference. (c) The information set forth in the Offer to Exchange under Section 7 ("Price Range of Common Stock Underlying the Options") is incorporated herein by reference. Item 3. Identity and Background of Filing Person. (a) The information set forth under Item 2(a) above is incorporated herein by reference. Item 4. Terms of the Transaction. (a) The information set forth in the Offer to Exchange under "Summary Term Sheet," Section 1 ("Eligibility; Number of Options; Expiration Date"), Section 3 ("Procedures for Tendering Options"), Section 4 ("Withdrawal Rights"), Section 5 ("Acceptance of Options for Exchange and Issuance of New Options"), Section 6 ("Conditions of the Offer"), Section 8 ("Source and Amount of Consideration; Terms of New Options"), Section 11 ("Status of Options Acquired by Us in the Offer; Accounting Consequences of the Offer"), Section 12 ("Legal Matters; Regulatory Approvals"), Section 13 ("Material Federal Income Tax Consequences") and Section 14 ("Extension of Offer; Termination; Amendment") is incorporated herein by reference. (b) The information set forth in the Offer to Exchange under Section 10 ("Interests of Directors and Officers; Transactions and Arrangements Concerning the Options") is incorporated herein by reference. Item 5. Past Contacts, Transactions, Negotiations and Arrangements. (e) The information set forth in the Offer to Exchange under Section 10 ("Interests of Directors and Officers; Transactions and Arrangements Concerning the Options") is incorporated herein by reference. Item 6. Purposes of the Transaction and Plans or Proposals. (a) The information set forth in the Offer to Exchange under Section 2 ("Purpose of the Offer") is incorporated herein by reference. (b) The information set forth in the Offer to Exchange under Section 5 ("Acceptance of Options for Exchange and Issuance of New Options") and Section 11 ("Status of Options Acquired by Us in the Offer; Accounting Consequences of the Offer") is incorporated herein by reference. (c) The information set forth in the Offer to Exchange under Section 2 ("Purpose of the Offer") is incorporated herein by reference. Item 7. Source and Amount of Funds or Other Consideration. (a) The information set forth in the Offer to Exchange under Section 8 ("Source and Amount of Consideration; Terms of New Options") and Section 15 ("Fees and Expenses") is incorporated herein by reference. (b) The information set forth in the Offer to Exchange under Section 6 ("Conditions of the Offer") is incorporated herein by reference. (d) Not applicable. Item 8. Interest in Securities of the Subject Company. (a) Not applicable. (b) The information set forth in the Offer to Exchange under Section 10 ("Interests of Directors and Officers; Transactions and Arrangements Concerning the Options") is incorporated herein by reference. Item 9. Person/Assets, Retained, Employed, Compensated or Used. (a) Not applicable. Item 10. Financial Statements. (a) The information set forth in the Offer to Exchange under Section 9 ("Information Concerning Answerthink") and Section 16 ("Additional Information") and on pages 18 through 40 of the Company's Annual Report on Form 10-K for it's fiscal year ended December 29, 2000 and pages 2 through 7 of the Company's Quarterly Report on Form 10-Q for its fiscal quarter ended March 30, 2001 is incorporated herein by reference. Item 11. Additional Information. (a) The information set forth in the Offer to Exchange under Section 10 ("Interests of Directors and Officers; Transactions and Arrangements Concerning the Options") and Section 12 ("Legal Matters; Regulatory Approvals") is incorporated herein by reference. (b) Not applicable. Item 12. Exhibits. (a) (1) Offer to Exchange, dated June 27, 2001. (2) Form of Letter of Transmittal. (3) Form of Letter to Eligible Option Holders. (4) Form of Electronic Mail Message to Eligible Option Holders. (5) Form of Letter to Tendering Option Holders. (6) Answerthink, Inc. Annual Report on Form 10-K for its fiscal year ended December 29, 2000, filed with the Securities and Exchange Commission on March 29, 2001 and incorporated herein by reference. (7) Answerthink, Inc. Quarterly Report on Form 10-Q for its fiscal quarter ended March 30, 2001, filed with the Securities and Exchange Commission on May 14, 2001 and incorporated herein by reference. (b) Not applicable. (d) (1) Answerthink, Inc. 1998 Stock Option and Incentive Plan. (2) Form of Employee Stock Option Agreement Pursuant to the Answerthink, Inc. 1998 Stock Option and Incentive Plan. (3) Form of Director Stock Option Agreement Pursuant to the Answerthink, Inc. 1998 Stock Option and Incentive Plan. (g) Not applicable. (h) Not applicable. Item 13. Information Required by Schedule 13E-3. (a) Not applicable. SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Schedule TO is true, complete and correct. Answerthink, Inc. /s/ Ted A. Fernandez ------------------------------------ Ted A. Fernandez Chairman and Chief Executive Officer Date: June 27, 2001 Index to Exhibits Exhibit Number Description - ------ --------------------- (a)(1) Offer to Exchange, dated June 27, 2001. (a)(2) Form of Letter of Transmittal. (a)(3) Form of Letter to Eligible Option Holders. (a)(4) Form of Electronic Mail Message to Eligible Option Holders. (a)(5) Form of Letter to Tendering Option Holders. (a)(6) Answerthink, Inc. Annual Report on Form 10-K for its fiscal year ended December 29, 2000, filed with the Securities and Exchange Commission on March 29, 2001 and incorporated herein by reference. (a)(7) Answerthink, Inc. Quarterly Report on Form 10-Q for its fiscal quarter ended March 30, 2001, filed with the Securities and Exchange Commission on May 14, 2001 and incorporated herein by reference. (d)(1) Answerthink, Inc. 1998 Stock Option and Incentive Plan. (d)(2) Form of Employee Stock Option Agreement Pursuant to the Answerthink, Inc. 1998 Stock Option and Incentive Plan. (d)(3) Form of Director Stock Option Agreement Pursuant to the Answerthink, Inc. 1998 Stock Option and Incentive Plan. EX-99.A.1 2 dex99a1.txt EXHIBIT (A)(1) Exhibit (a)(1) -------------- ANSWERTHINK, INC. OFFER TO EXCHANGE OUTSTANDING OPTIONS FOR NEW OPTIONS - -------------------------------------------------------------------------------- THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., EASTERN DAYLIGHT TIME, ON AUGUST 8, 2001, UNLESS THE OFFER IS EXTENDED. - -------------------------------------------------------------------------------- Answerthink, Inc. is offering its employees and members of its board of directors the opportunity to exchange (i) all outstanding nonqualified options under the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Answerthink Option Plan") or the Think New Ideas, Inc. Amended and Restated 1997 Stock Option Plan (the "Think New Ideas 1997 Option Plan") or the Think New Ideas, Inc. Amended and Restated 1998 Stock Option Plan (the "Think New Ideas 1998 Option Plan" and, together with the Answerthink Option Plan and the Think New Ideas 1997 Option Plan, the "Plans") and (ii) all outstanding incentive stock options that have an exercise price of $10.00 per share or more under the Plans for new options which we will grant under the Answerthink Option Plan. We are making this offer upon the terms and subject to the conditions set forth in this offer to exchange and in the related letter of transmittal (which together, as they may be amended from time to time, constitute the "offer"). The number of new options to be granted to each employee or member of our board of directors will be equal to 662/3% of the number of shares subject to the options tendered by such employee or member of our board of directors and accepted for exchange. This means that for every three options that you tender and we accept for exchange, you will receive two new options. We will not, however, issue any new options exercisable for fractional shares. Instead, we will round up to the nearest whole number. The number of new options will be adjusted for any stock splits, stock dividends and similar events completed after the expiration date and prior to the issuance of the new options. We will grant the new options on or about the day which is at least six months and one day following the date we cancel the options accepted for exchange. You must tender all unexercised options subject to an individual grant. If you choose to participate in the offer, you must also tender all options that you received during the six months immediately prior to the expiration date of the offer, currently expected to be August 8, 2001, if those grants were made subsequent to and have an exercise price lower than the exercise price of the options that you wish to replace. This offer is not conditioned upon a minimum number of options being tendered. This offer is subject to conditions which we describe in section 6. If you tender options for exchange as described in the offer, we will grant you new options under the Answerthink Option Plan and a new option agreement between you and us. The exercise price of the new options will be equal to the last reported sale price of our common stock on the Nasdaq Stock Market's National Market ("Nasdaq"), or such other national securities exchange or interdealer quotation system on which our common stock is then traded, on the date of grant or, if the grant date is not a business day, as of the last business day preceding the grant date. The new options granted to you will have the same vesting schedule, measured from the same grant date, as the options tendered by you and accepted for exchange. Although our board of directors has approved this offer, neither we nor our board of directors makes any recommendation as to whether you should tender or refrain from tendering your options for exchange. You must make your own decision whether to tender your options. Shares of our common stock are quoted on Nasdaq under the symbol "ANSR." On June 20, 2001, the last reported sale price of our common stock on Nasdaq was $7.30 per share. We recommend that you obtain current market quotations for our common stock before deciding whether to tender your options. You should direct questions about this offer or requests for assistance or for additional copies of the offer to exchange or the letter of transmittal to Human Resources, Attn: Robert Greene at Answerthink, Inc., 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263). IMPORTANT If you wish to tender your options for exchange, you must complete and sign the letter of transmittal in accordance with its instructions, and mail or otherwise deliver it to Human Resources, Attn: Robert Greene at Answerthink, Inc., 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263). We recommend that if you choose to mail your letter of transmittal, you send it by certified or registered mail. Interoffice mail is not recommended since it can not be tracked. Please keep a copy of all documents. Answerthink will not be responsible for any lost mail, whether interoffice or otherwise. We are not making this offer to, nor will we accept any tender of options from or on behalf of, option holders in any jurisdiction in which the offer or the acceptance of any tender of options would not be in compliance with the laws of such jurisdiction. However, we may, at our discretion, take any actions necessary for us to make this offer to option holders in any such jurisdiction. We have not authorized any person to make any recommendation on our behalf as to whether you should tender or refrain from tendering your options pursuant to the offer. You should rely only on the information contained in this document or to which we have referred you. We have not authorized anyone to give you any information or to make any representation in connection with this offer other than the information and representations contained in this document or in the related letter of transmittal. If anyone makes any recommendation or representation to you or gives you any information, you must not rely upon that recommendation, representation or information as having been authorized by us. TABLE OF CONTENTS
Page ---- SUMMARY TERM SHEET................................................................ 1 RISK OF PARTICIPATING IN THE OFFER................................................ 8 THE OFFER......................................................................... 10 1. Eligibility; Number of Options; Expiration Date........................... 10 2. Purpose of the Offer...................................................... 11 3. Procedures for Tendering Options.......................................... 13 4. Withdrawal Rights......................................................... 14 5. Acceptance of Options for Exchange and Issuance of New Options............ 14 6. Conditions of the Offer................................................... 15 7. Price Range of Common Stock Underlying the Options........................ 18 8. Source and Amount of Consideration; Terms of New Options.................. 18 9. Information Concerning Answerthink........................................ 22 10. Interests of Directors and Officers; Transactions and Arrangements Concerning the Options.................................................... 25 11. Status of Options Acquired by Us in the Offer; Accounting Consequences of the Offer.............................................................. 26 12. Legal Matters; Regulatory Approvals....................................... 26 13. Material Federal Income Tax Consequences.................................. 27 14. Extension of Offer; Termination; Amendment................................ 27 15. Fees and Expenses......................................................... 28 16. Additional Information.................................................... 28 17. Miscellaneous............................................................. 30 SCHEDULE A........................................................................ A-1 SCHEDULE B........................................................................ B-1
i SUMMARY TERM SHEET The following are answers to some of the questions that you may have about this offer. We urge you to read carefully the remainder of this offer to exchange and the accompanying letter of transmittal because the information in this summary is not complete, and additional important information is contained in the remainder of this offer to exchange and the letter of transmittal. We have included page references to the remainder of this offer to exchange where you can find a more complete description of the topics in this summary. . What securities are we offering to exchange? We are offering our employees and members of our board of directors an opportunity to exchange (i) all outstanding nonqualified stock options under the Plans and (ii) all outstanding incentive stock options that have an exercise price of $10.00 per share or more under the Plans for new options under the Answerthink Option Plan. (Page 10) Your outstanding grants of options under the Plans are set forth on Schedule B to this offer to exchange. . Why are we making the offer? Many of our employees and members of our board of directors have current outstanding options with strike prices that are significantly higher than the current market price of our common stock. We believe in giving our employees and members of our board of directors long-term performance incentives. These options may not be providing such an incentive at this time. This exchange program will give employees and members of our board of directors an opportunity to receive options that may have a lower strike price. (Page 11) . What are the conditions to the offer? The offer is not conditioned upon a minimum number of options being tendered. However, the offer is subject to a number of conditions, including the conditions described in section 6. We urge you to carefully read these conditions. (Page 15) . Are there any eligibility requirements I must satisfy after the expiration date of the offer to receive the new options? To receive a grant of new options pursuant to the offer and under the terms of the Answerthink Option Plan, you must be an employee or member of the board of directors of Answerthink from the date you tender options through the date we grant the new options. In addition, if you are a former member of our board of directors, who served your entire term of office and received options in connection with your service on the board, you will also be eligible to receive the new options. As discussed below, we will not grant the new options until on or about the day which is at least six months and one day following the date we cancel the options accepted for exchange. If you are not an employee or member of the board of directors of Answerthink from the date you tender options through the date we grant the new options, other than if your term of office as a director expires, you will not receive any new options in exchange for 1 your tendered options that have been accepted for exchange. You also will not receive any other consideration for the options tendered if you are not an employee or a member of our board of directors from the date you tender options through the date we grant the new options, other than if your term of office as a director expires. This means that if you die or voluntarily terminate your employment or service as a member of our board of directors or we terminate your employment or service as a member of our board of directors prior to the date we grant the new options, you will not receive anything for the options that you tendered and we cancelled. (Page 10) . How many new options will I receive in exchange for my tendered options? We will grant you new options to purchase the number of shares of our common stock that is equal to 66 2/3% of the number of options properly tendered by you. This means that for every three options that you tender and we accept for exchange, you will receive two new options. We will not, however, issue any new options exercisable for fractional shares. Instead, we will round up to the nearest whole number. For example, if you tender options exercisable for 1,000 shares that we accept for exchange, you will receive new options exercisable for 667 shares, rather than 666-2/3 shares. The new options will be granted under our Answerthink Option Plan and will be subject to the terms and conditions of the Answerthink Option Plan and a new option agreement between you and us. All options accepted by us pursuant to the offer will be canceled. (Page 15) . When will I receive my new options? We will grant the new options on or about the day that is at least six months and one day after the date we cancel the options accepted for exchange. For example, if we cancel tendered options on August 8, 2001, which is the scheduled expiration date of the offer, the grant date of the new options will be on or about February 9, 2002. (Page 14) . Why won't I receive my new options immediately after the expiration date of the offer? The current accounting rules specify that a minimum of six months and one day must pass before we issue the exchange options. If we do not follow this guidance, we would be subject to compensation charges against our earnings for financial reporting purposes. The accounting rules also prevent us from setting the exercise price for the exchange options prior to the actual grant date. Again, if we do not follow these rules, we would be subject to unfavorable accounting treatment for the exchange program. (Page 15) . Why not just reprice the currently outstanding options? Based on the same accounting guidance mentioned above, "repricing" existing options, or resetting the strike price of these outstanding options to the current market price of our stock, would result in charges against our earnings for financial reporting purposes. 2 . If I tender options in the offer, will I be eligible to receive other option grants before I receive my new options? If we accept options you tender in the offer, we will defer until the grant date for your new options our grant to you of other options, such as performance-related option commitments in your offer letter or employment agreement, for which you may be eligible before the new option grant date. We will defer the grant to you of these other options in order to avoid adverse accounting charges against our earnings. (Page 15) . What happens if Answerthink is acquired during the period after my options are canceled but before I am granted new options? It is possible that prior to the grant date of the new options we might enter into an agreement for a merger into another company or change of control transaction. These types of transactions could have substantial effects on our stock price, including substantial stock price appreciation. Depending on the structure of a transaction, option holders participating in this offer might be deprived of any further price appreciation in the common stock or deprived of the opportunity to participate in the option exchange program. If we are a party to a merger into another company or change of control transaction before the grant date of the new options, we will endeavor to negotiate as part of the transaction an agreement for the acquiring entity to grant options or compensation comparable to the new options to continuing employees, although there can be no assurance that we would be successful in negotiating such an agreement. We reserve the right, however, in the event of a merger into another company or change of control transaction, to take any actions we deem necessary or appropriate to complete a transaction that our board of directors believes is in the best interest of our company and our shareholders. This could include terminating your right to receive new options under this offer. If we were to terminate your right to receive new options under this offer in connection with such transaction, employees who tendered options pursuant to this offer would not receive new options to purchase our common stock, or securities of the acquiror or any other consideration for their tendered options. (Page 11) . What will the exercise price of the new options be? The exercise price of the new options will be equal to the last reported sale price of our common stock on Nasdaq on the date we grant the new options or, if the grant date is not a business day, as of the last business day preceding the grant date. Accordingly, we cannot predict the exercise price of the new options. Because we will not grant new options until at least six months and one day after the date we cancel the options accepted for exchange, the new options may have a higher exercise price than some or all of your current options. We recommend that you obtain current market quotations for our common stock before deciding whether to tender your options. (Page 19) 3 . When will the new options vest? The new options granted to you will have the same vesting schedule, measured from the same grant date, as the options tendered by you and accepted for exchange. Here is an example of how the vesting schedule will work: Original Grant Surrendered by Associate - --------------------------------------- 3,000 options granted on August 31, 1999 Vesting Schedule Options Strike Price - ---------------- ------- ------------ 50% after 2 years (August 2001) 1,500 $25.00 25% August 2002 750 $25.00 25% August 2003 750 $25.00 New Grant to be Received by Associate - ------------------------------------- 2,000 options granted on February 9, 2002 (projected grant date) Vesting Schedule Options Strike Price - ---------------- ------- ------------ 50% fully vested (August 2001) 1,000 February 8, 2002 closing price 25% vested August 2002 500 February 8, 2002 closing price 25% vested August 2003 500 February 8, 2002 closing price After the date we grant the new options, you generally will forfeit the non- vested portion of any new option when you cease to be employed with us. (Page 20) . Do I have to tender each option grant for all of the unexercised options subject to that grant? Yes. You must tender all unexercised options subject to an option grant. We are not accepting partial tenders of an individual unexercised option grant. For example, if you hold an option to purchase 3,000 shares of common stock, you must either tender all or none of such option. You cannot tender only part of the option and retain the remainder of the option. (Page 10) . If I have multiple option grants, can I choose which options to tender in the offer? Yes. You may tender all or any of your nonqualified option grants and all or any of your incentive stock option grants that have an exercise price of $10.00 per share or more. However, if you choose to participate in the offer, you must tender all options that you received during the six months immediately prior to the expiration date of the offer, currently expected to be August 8, 2001, if those grants were made subsequent to and have an exercise price lower than the exercise price of the options that you wish to replace. Please note that, if you received an end of year 2000 performance grant and/or an Employee Stock Purchase Plan special grant, you do not have to tender these options as they fall outside the six-month period. (Page 10) 4 . Will I have to pay taxes if I exchange my options in the offer? We believe that the exchange will be treated as a non-taxable exchange. This means that, if you exchange your current options for new options, you will not be required under current law to recognize income for federal income tax purposes at the time of the exchange. Further, at the date of grant of the new options, you will not be required under current law to recognize income for federal income tax purposes. We believe that the grant of options is not recognized as taxable income. We recommend that you consult with your own tax advisor to determine the tax consequences of tendering options pursuant to the offer. (Page 22) Certain consequences to holders of incentive stock options that have an exercise price of $10.00 per share or more who do not tender these options in the offer are discussed in the offer to exchange. (Page 21) . If my current options are incentive stock options, will my new options be incentive stock options? No. All of the new options granted pursuant to the offer will be nonqualified stock options. (Page 19) . Will the terms and conditions of my new options be identical to the terms of my current options? No. This offer is open to option holders who have been granted options under several of our stock option plans. However, pursuant to the terms of the offer, we will be granting new options under the terms of the Answerthink Option Plan and a new option agreement between you and us. (Page 18) . When does the offer expire? Can the offer be extended, and if so, how will I be notified if it is extended? The offer expires on August 8, 2001, at 5:00 p.m., Eastern Daylight time, unless it is extended by us. (Page 11) We may, at our discretion, extend the offer at any time, but we cannot assure you that the offer will be extended or, if extended, for how long. If the offer is extended, we will make a public announcement of the extension no later than 9:00 a.m. on the next business day following the previously scheduled expiration of the offer period. (Page 27) . How do I tender my options? If you decide to tender your options, your properly completed and duly executed letter of transmittal must be received before 5:00 p.m., Eastern Daylight time, on August 8, 2001, at Answerthink, Inc., Human Resources, Attn: Robert Greene 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263). 5 If we extend the offer beyond that time, we must receive your properly completed and duly executed letter of transmittal before the extended expiration of the offer. We reserve the right to reject any or all tenders of options that we determine are not in appropriate form or that we determine are unlawful to accept. Otherwise, we will accept properly and timely tendered options which are not validly withdrawn. Subject to our rights to extend, terminate and amend the offer, we will accept all such properly tendered options promptly after the expiration of the offer. We recommend that if you choose to mail your letter of transmittal, you send it by certified or registered mail. Interoffice mail is not recommended since it can not be tracked. Please keep a copy of all documents. Answerthink will not be responsible for any lost mail, whether interoffice or otherwise. (Page 13) . Where do I go to find out the number of options and the strike price of my current outstanding option grants? This information is set forth on Schedule B to this offer to exchange. Additionally, you can access your stock option information either by phone using the Smith Barney Voice Response Unit, or VRU, or on the Internet by accessing www.benefitaccess.com. If you are using the VRU, you will need your social security number and personal identification number, or PIN, number. The Internet will require entry of your user name and a password. . Will I receive a confirmation statement verifying my tender? Promptly after we accept tendered options for exchange, we will send each tendering option holder a letter indicating the number of shares subject to the options that we have accepted for exchange, the corresponding number of shares that will be subject to the new options and the expected grant date of the new options. (Page 15) . Do I need to do anything if I do not want to tender my options? No. If you do not deliver a properly completed and duly executed letter of transmittal prior to the expiration of the offer, you will not be a participant in the offer. . During what period of time may I withdraw previously tendered options? You may withdraw your tendered options at any time before 5:00 p.m., Eastern Daylight time, on August 8, 2001. If we extend the offer beyond that time, you may withdraw your tendered options at any time until the extended expiration of the offer. To withdraw tendered options, you must deliver to us a written notice of withdrawal with the required information while you still have the right to withdraw the tendered options. Once you have withdrawn options, you may re-tender options only by again following the delivery procedures described above. (Page 14) 6 . What does management and our board of directors think of the offer? Although the board of directors has approved this offer, neither management nor the board of directors makes any recommendation as to whether you should tender or refrain from tendering your options. You must make your own decision whether to tender options. We have been advised that our executive officers and directors intend to tender options pursuant to this offer. (Page 13) . Who can I talk to if I have questions about the offer? For additional information or assistance, you should contact: Answerthink, Inc. Human Resources Attn: Robert Greene 817 W. Peachtree Street, Suite 800 Atlanta, Georgia 30308 (telephone: (404) 682-2263) 7 RISK OF PARTICIPATING IN THE OFFER Participation in the offer involves a number of potential risks, including those described below. This list briefly highlights some of the risks and is necessarily incomplete. Eligible employees should carefully consider these and other risks and are encouraged to speak with an investment and tax advisor as necessary before deciding whether and to what extent to participate in the offer. In addition, we strongly urge you to carefully read the remainder of this offer before deciding whether and to what extent to participate. . Participation in the offer will make you ineligible to receive any option grants until February 9, 2002 at the earliest. Employees are generally eligible to receive option grants at any time that the board of directors or compensation committee chooses to make them. However, if we were to grant you new options on any date which is earlier than six months and one day after the date we cancel the options accepted for exchange, we would be required for financial reporting purposes to record compensation expense against our earnings. Therefore, if you participate in the offer, we will defer until February 9, 2002 at the earliest our grant to you of other options, such as performance-related option commitments in your offer letter or employment agreement, for which you may be eligible before the new option grant date. We do plan to grant the annual year-end performance options; however, these options will not be granted until after February 9, 2002. . If our stock price increases after the date your tendered options are canceled, your canceled options might have been worth more than the new options that you have been granted in exchange for them. For example, if you tender 1,000 options with a $12.00 exercise price per share and our stock price appreciates to $15.00 on the date the new option grants are made, after the offer you will have 667 options at an exercise price of $15.00 per share. Therefore, after the offer, you will have fewer options at an exercise price higher than that of the options that you tendered and were canceled. . If your employment or service as a member of our board of directors terminates prior to the grant of the new options, you will receive no additional consideration. Once your option is canceled, it cannot be reinstated. Accordingly, if your employment or service as a member of our board of directors terminates for any reason, other than if your term of office as a director expires, prior to the grant of the new options, you will have the benefit of neither the canceled option nor the new option. . We investigate strategic opportunities from time to time which, if concluded, could affect the pricing and/or terms of your new options. We consistently evaluate strategic opportunities that may arise, including additional capital infusions, joint ventures, strategic partnerships, acquisitions and mergers. If any of these transactions were to occur before the new options are granted, and our stock price appreciates, your new options could be granted at a higher exercise price, and could be 8 subject to additional terms and conditions required by an investing or acquiring party. Also, you could forfeit any acceleration of vesting to which you might otherwise be entitled under your existing options. (Page 20) . What happens if Answerthink sells one of its practices or service lines during the period after my options are canceled but before I am granted new options? In the ordinary course of business, we are consistently exploring ways to make our business more efficient and rationalize operations, including through strategic alternatives for some of our practices or service lines. While we currently have no definitive plans to enter into any such transaction, it is possible that prior to the grant date of the new options we might enter into an agreement resulting in the disposition of one or more of our practices or service lines. If you are an employee of one of our practices or service lines which is sold after the cancellation of your options but prior to the grant date of the new options, you will have the benefit of neither the canceled option nor the new option. . Your new options will be subject to the general risks of our business. For a description of risks related to our business, please see section 17. 9 THE OFFER 1. Eligibility; Number of Options; Expiration Date. All of our employees and members of our board of directors are eligible to participate in this offer. Upon the terms and subject to the conditions of the offer, we will exchange for new options to purchase common stock under the Answerthink Option Plan (i) all outstanding nonqualified options under the Plans and (ii) all outstanding incentive stock options that have an exercise price of $10.00 per share or more under the Plans that are properly tendered and not validly withdrawn in accordance with section 4 before the "expiration date," as defined below. We will not accept partial tenders of unexercised option grants. Therefore, you must tender options for all or none of the unexercised options subject to a particular option grant. If you choose to participate in the offer, you must also tender all options that you received during the six months immediately prior to the expiration date of the offer, currently expected to be August 8, 2001, if those grants were made subsequent to and have an exercise price lower than the exercise price of the other options that you wish to replace. Please note that, if you received an end of year 2000 performance grant and/or an Employee Stock Purchase Plan special grant, you do not have to tender these options as they fall outside the six-month period. As of June 20, 2001, 12,482,742 options were outstanding under the Plans. Of these options, 11,786,195 were nonqualified options and 565,306 were incentive stock options that had an exercise price of $10.00 per share or more. The options that we are offering to exchange represent approximately 98.95% of the total options outstanding under the Plans as of June 20, 2001. If your options are properly tendered and accepted for exchange, you will be entitled to receive new options to purchase the number of shares of our common stock which is equal to 662/3% of the number of shares subject to the options that you tendered, subject to adjustments for any stock splits, stock dividends and similar events. This means that for every three options that you tender and we accept for exchange, you will receive two new options. However, we will not issue any options exercisable for fractional shares. Instead, we will round up to the nearest whole number. All new options will be subject to the terms of the Answerthink Option Plan and to a new option agreement between you and us. If you are not an employee or member of the board of directors of Answerthink continuously from the date you tender options through the date we grant the new options, other than if your term of office as a director expires, you will not receive any new options in exchange for your tendered options that have been accepted for exchange. You also will not receive any other consideration for your tendered options if you are not an employee or member of our board of directors from the date you tender options through the date we grant the new options, other than if your term of office as a director expires. This means that if you die or voluntarily terminate your employment or service as a member of our board of directors or we terminate your employment or service as a member of our board of directors prior to the date we grant the new options, you will not receive anything for the options that you tendered and we cancelled. 10 We are also reserving the right, in the event of a merger into another company or change of control transaction after the expiration date but before the grant date of the new options, to take any actions we deem necessary or appropriate to complete a transaction that our board of directors believes is in the best interest of our company and our shareholders. This could include terminating the right to receive new options under this offer. If we were to terminate your right to receive new options under this offer in connection with such a merger into another company or change of control transaction, employees or members of our board of directors who tendered options pursuant to this offer would not receive new options to purchase our common stock, or securities of the acquiror, or any other consideration for their tendered options. However, if we are a party to a merger into another company or change of control transaction before the grant date of the new options, we will endeavor to negotiate as part of the transaction an agreement for the acquiring entity to grant options or compensation comparable to the new options that would have been received under the offer, although there can be no assurance that we would be successful in negotiating such an agreement. Section 2 of this offer to exchange describes our future plans. The term "expiration date" means 5:00 p.m., Eastern Daylight time, on August 8, 2001, unless and until we, in our discretion, have extended the period of time during which the offer will remain open, in which event the term "expiration date" refers to the latest time and date at which the offer, as so extended, expires. See section 14 for a description of our rights to extend, delay, terminate and amend the offer. If we decide to take any of the following actions, we will publish notice of such action and extend the offer for a period of ten business days after the date of such publication: (a) (1) we increase or decrease the amount of consideration offered for the options; (2) we decrease the number of options eligible to be tendered in the offer; or (3) we increase the number of options eligible to be tendered in the offer by an amount that exceeds 2% of the shares of common stock issuable upon exercise of the options that are subject to the offer immediately prior to the increase; and (b) the offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that notice of such increase or decrease is first published, sent or given in the manner specified in section 14. For purposes of the offer, a "business day" means any day other than a Saturday, Sunday or federal holiday and consists of the time period from 12:01 a.m. through 12:00 midnight, Eastern Daylight time. 2. Purpose of the Offer. We issued the options outstanding under the Plans for the following purposes: 11 . to provide our employees and members of our board of directors an opportunity to acquire or increase a proprietary interest in Answerthink, thereby creating a stronger incentive to expend maximum effort for our growth and success; and . to encourage our employees and members of our board of directors to continue their employment or service with us. Many of our outstanding options, whether or not they are currently exercisable, have exercise prices that are significantly higher than the current market price of our common stock. By making this offer to exchange outstanding options for new options that will have an exercise price equal to the market value of our common stock on the grant date, we intend to provide our employees and members of our board of directors with the benefit of owning options that may have a lower strike price and thus create better performance incentives for our employees and members of our board of directors. We consistently evaluate strategic opportunities that may arise, including additional capital infusions, joint ventures, strategic partnerships, acquisitions and mergers. Subject to the foregoing and except as otherwise disclosed in our SEC filings or in this offer to exchange, as of the date of this filing we presently have no definitive agreements or arrangements that have not been publicly disclosed that relate to or would result in: (a) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving us or any of our subsidiaries; (b) any purchase, sale or transfer of a material amount of our assets or the assets of any of our subsidiaries; (c) any material change in our present dividend rate or policy, or our indebtedness or capitalization; (d) any change in our present board of directors or management, including a change in the number or term of directors or to fill any existing board vacancies or to change any executive officer's material terms of employment; (e) any other material change in our corporate structure or business; (f) our common stock being delisted from a national securities exchange; (g) our common stock becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act; (h) the suspension of our obligation to file reports pursuant to Section 15(d) of the Securities Exchange Act; (i) the acquisition by any person of any of our securities or the disposition of any of our securities; or 12 (j) any change in our certificate of incorporation or bylaws, or any actions which may impede the acquisition of control of us by any person. Nothing contained herein shall restrict our ability to any of the foregoing. Neither we nor our board of directors makes any recommendation as to whether you should tender your options, nor have we authorized any person to make any such recommendation. You are urged to evaluate carefully all of the information in this offer to exchange and to consult your own investment and tax advisors. You must make your own decision whether to tender your options for exchange. 3. Procedures for Tendering Options. Proper Tender of Options. To validly tender your options pursuant to the offer, you must, in accordance with the terms of the letter of transmittal, properly complete, duly execute and deliver to us the letter of transmittal. We must receive the completed and executed letter of transmittal at Answerthink, Inc., Human Resources, Attn: Robert Greene, 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263) before the expiration date. The method of delivery of all documents, including letters of transmittal, is at the election and risk of the tendering option holder. If delivery is by mail, we recommend that you use registered mail with return receipt requested and properly insure your package. In all cases, you should allow sufficient time to ensure timely delivery. Answerthink will not be responsible for any lost mail, whether interoffice or otherwise. Determination of Validity; Rejection of Options; Waiver of Defects; No Obligation to Give Notice of Defects. We will determine, in our discretion, all questions as to form of documents and the validity, form, eligibility, including time of receipt, and acceptance of any tender of options. Our determination of these matters will be final and binding on all parties. We reserve the right to reject any or all tenders of options that we determine are not in appropriate form or that we determine are unlawful to accept. Otherwise, we will accept properly and timely tendered options which are not validly withdrawn. We also reserve the right to waive any of the conditions of the offer or any defect or irregularity in any tender with respect to any particular options or any particular option holder. No tender of options will be deemed to have been properly made until all defects or irregularities have been cured by the tendering option holder or waived by us. Neither we nor any other person is obligated to give notice of any defects or irregularities in tenders, nor will anyone incur any liability for failure to give any such notice. Our Acceptance Constitutes an Agreement. Your tender of options pursuant to the procedures described above constitutes your acceptance of the terms and conditions of the offer. Our acceptance for exchange of your options tendered by you pursuant to the offer will constitute a binding agreement between you and us upon the terms and subject to the conditions of the offer. 13 Subject to our rights to extend, terminate and amend the offer, we will accept promptly after the expiration of the offer all properly tendered options that have not been validly withdrawn. 4. Withdrawal Rights. You may only withdraw your tendered options in accordance with the provisions of this section 4. You may withdraw your tendered options at any time before 5:00 p.m., Eastern Daylight time, on August 8, 2001. If the offer is extended by us beyond that time, you may withdraw your tendered options at any time until the extended expiration of the offer. In addition, unless we accept your tendered options for exchange before 12:00 midnight, Eastern Daylight time, on August 22, 2001, you may withdraw your tendered options at any time after August 22, 2001. To validly withdraw tendered options, you must deliver to us at the address set forth on the back cover of this offer to exchange a written notice of withdrawal with the required information, while you still have the right to withdraw the tendered options. The notice of withdrawal must specify your name, the grant date, exercise price, and total number of option shares subject to each option to be withdrawn. Except as described in the following sentence, the notice of withdrawal must be executed exactly as your name appears on the option agreement or agreements evidencing the options to be withdrawn. If the signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or another person acting in a fiduciary or representative capacity, the signer's full title and proper evidence of the authority of such person to act in such capacity must be indicated on the notice of withdrawal. You may not rescind any withdrawal, and any options you withdraw will thereafter be deemed not properly tendered for purposes of the offer, unless you properly re-tender those options before the expiration date by following the procedures described in section 3. Neither Answerthink nor any other person is obligated to give notice of any defects or irregularities in any notice of withdrawal, nor will anyone incur any liability for failure to give any such notice. We will determine, in our discretion, all questions as to the form and validity, including time of receipt, of notices of withdrawal. Our determination of these matters will be final and binding. 5. Acceptance of Options for Exchange and Issuance of New Options. Upon the terms and subject to the conditions of this offer and as promptly as practicable following the expiration date, we will accept for exchange and cancel options properly tendered and not validly withdrawn before the expiration date. If your options are properly tendered and accepted for exchange on August 8, 2001, the scheduled expiration date of the offer, you will be granted new options on or about February 9, 2002, which is the day that is at least six months and one day following the date we cancel the options accepted for exchange. If we extend the date by which we must accept and cancel options 14 properly tendered for exchange, you will be granted new options on a subsequent day which is on or about the day at least six months and one day following the extended date. Because of accounting rules that could apply to interim option grants as a result of the offer, if we accept options you tender in the offer, we will defer until the grant date for your new options our grant to you of other options, such as performance-related option commitments in your offer letter or employment agreement, for which you may be eligible before the new option grant date. Therefore, if you participate in the offer, you will not be eligible to receive any option grants until February 9, 2002 at the earliest. Your new options will entitle you to purchase a number of shares of our common stock which is equal to 66 2/3% of the number of shares subject to the options you tender, subject to adjustments for any stock splits, stock dividends and similar events. This means that for every three options that you tender and we accept for exchange, you will receive two new options. However, we will not issue any options exercisable for fractional shares. Instead, we will round up to the nearest whole number. If you are not an employee or member of the board of directors of Answerthink from the date you tender options through the date we grant the new options, other than if your term of office as a director expires, you will not receive any new options in exchange for your tendered options that have been accepted for exchange. You also will not receive any other consideration for your tendered options if you are not an employee or member of our board of directors from the date you tender options through the date we grant the new options, other than if your term of office as a director expires. This means that if you die or voluntarily terminate your employment or service as a member of our board of directors or we terminate your employment or service as a member of our board of directors prior to the date we grant the new options, you will not receive anything for the options that you tendered and we cancelled. For purposes of the offer, we will be deemed to have accepted for exchange options that are validly tendered and not properly withdrawn as, if and when we give oral or written notice to the option holders of our acceptance for exchange of such options. Subject to our rights to extend, terminate and amend the offer, we will accept promptly after the expiration of the offer all properly tendered options that are not validly withdrawn. Promptly after we accept tendered options for exchange, we will send each tendering option holder a letter indicating the number of shares subject to the options that we have accepted for exchange, the corresponding number of shares that will be subject to the new options and the expected grant date of the new options. 6. Conditions of the Offer. Notwithstanding any other provision of the offer, we will not be required to accept any options tendered for exchange, and we may terminate or amend the offer, or postpone our acceptance and cancellation of any options tendered for exchange, in each case, subject to Rule 13e-4(f)(5) under the Securities Exchange Act, if at any time on or after June 27, 2001 and prior to the expiration date any of the following events has occurred, or has been determined by us to have occurred, and, in our reasonable judgment in any such case and regardless of the circumstances giving rise thereto, including any action or omission to act by us, the occurrence of such event or events makes it inadvisable 15 for us to proceed with the offer or with such acceptance and cancellation of options tendered for exchange: (a) there shall have been threatened or instituted or be pending any action or proceeding by any government or governmental, regulatory or administrative agency, authority or tribunal or any other person, domestic or foreign, before any court, authority, agency or tribunal that directly or indirectly (1) challenges the making of the offer, the acquisition of some or all of the tendered options pursuant to the offer, the issuance of new options, or otherwise relates in any manner to the offer or (2) in our reasonable judgment, could materially and adversely affect the business, condition (financial or other), income, operations or prospects of Answerthink or our subsidiaries, or otherwise materially impair in any way the contemplated future conduct of our business or the business of any of our subsidiaries or materially impair the contemplated benefits of the offer to us; (b) there shall have been any action threatened, pending or taken, or approval withheld, or any statute, rule, regulation, judgment, order or injunction threatened, proposed, sought, promulgated, enacted, entered, amended, enforced or deemed to be applicable to the offer or us or any of our subsidiaries, by any court or any authority, agency or tribunal that, in our reasonable judgment, would or might directly or indirectly: (1) make the acceptance for exchange of, or issuance of new options for, some or all of the tendered options illegal or otherwise restrict or prohibit consummation of the offer or otherwise relates in any manner to the offer; (2) delay or restrict our ability, or render us unable, to accept for exchange, or issue new options for, some or all of the tendered options; (3) materially impair the contemplated benefits of the offer to us; or (4) materially and adversely affect the business, condition (financial or other), income, operations or prospects of Answerthink or our subsidiaries, or otherwise materially impair in any way the contemplated future conduct of our business or the business of any of our subsidiaries, taken as a whole, or otherwise materially impair the contemplated benefits of the offer to us; (c) there shall have occurred: (1) any general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the over-the-counter market; (2) the declaration of a banking moratorium or any suspension of payments in respect of banks in the United States, whether or not mandatory; (3) the commencement of a war, armed hostilities or other international or national crisis directly or indirectly involving the United States; (4) any limitation, whether or not mandatory, by any governmental, regulatory or administrative agency or authority on, or any event that in our reasonable judgment might affect, the extension of credit by banks or other lending institutions in the United States; (5) any change in the general political, market, economic or financial conditions in the United States or abroad that could have a material 16 adverse effect on the business, condition (financial or other), operations or prospects of Answerthink or our subsidiaries or that, in our reasonable judgment, makes it inadvisable to proceed with the offer; or (6) in the case of any of the foregoing existing at the time of the commencement of the offer, a material acceleration or worsening thereof; (d) there shall have occurred any change in generally accepted accounting standards which could or would require us for financial reporting purposes to record compensation expense against our earnings in connection with the offer; (e) a tender or exchange offer with respect to some or all of our common stock, or a merger or acquisition proposal for us, shall have been proposed, announced or made by another person or entity or shall have been publicly disclosed, or we shall have learned that: (1) any person, entity or "group," within the meaning of Section 13(d)(3) of the Securities Exchange Act, shall have acquired or proposed to acquire beneficial ownership of more than 5% of the outstanding shares of our common stock, or any new group shall have been formed that beneficially owns more than 5% of the outstanding shares of our common stock, other than any such person, entity or group that has filed a Schedule 13D or Schedule 13G with the SEC on or before June 27, 2001; (2) any such person, entity or group that has filed a Schedule 13D or Schedule 13G with the SEC on or before June 27, 2001 shall have acquired or proposed to acquire beneficial ownership of an additional 2% or more of the outstanding shares of our common stock; or (3) any person, entity or group shall have filed a Notification and Report Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 or made a public announcement reflecting an intent to acquire us or any of our subsidiaries or any of the assets or securities of us or any of our subsidiaries; or (f) any change or changes shall have occurred in the business, condition (financial or other), assets, income, operations, prospects or stock ownership of Answerthink or our subsidiaries that, in our reasonable judgment, is or may be material to Answerthink or our subsidiaries. The conditions to the offer are for our benefit. We may assert them in our discretion regardless of the circumstances giving rise to them prior to the expiration date. We may waive them, in whole or in part, at any time and from time to time prior to the expiration date, in our discretion, whether or not we waive any other condition to the offer. Our failure at any time to exercise any of these rights will not be deemed a waiver of any such rights. Any determination we make concerning the events described in this section 6 will be final and binding upon all persons. If we accept options you tender in the offer, we will defer any grant to you of additional options for which you may be eligible before the new option grant date until after the new option grant date, so that you will be granted no new options for any reason until 17 at least six months and one day after any of your tendered options have been canceled. We will defer the grant to you of any additional options in order to avoid incurring compensation expense against our earnings as a result of accounting rules that could apply to these interim option grants as a result of the offer. 7. Price Range of Common Stock Underlying the Options. Our common stock is quoted on Nasdaq under the symbol "ANSR." The following table shows, for the fiscal periods indicated, the high and low sales prices per share of our common stock as reported by Nasdaq. High Low ---- --- 2001 Second Quarter (through June 20, 2001)............ $ 8.48 $ 3.50 First Quarter..................................... 9.06 3.25 2000 Fourth Quarter.................................... 18.75 2.53 Third Quarter..................................... 19.94 13.44 Second Quarter.................................... 28.50 14.00 First Quarter..................................... 40.38 18.81 1999 Fourth Quarter.................................... 36.81 9.25 Third Quarter..................................... 25.50 9.50 Second Quarter.................................... 28.94 18.75 First Quarter..................................... 36.63 24.50 As of June 20, 2001, the last reported sale price of our common stock, as reported by Nasdaq, was $7.30 per share. We recommend that you obtain current market quotations for our common stock before deciding whether to tender your options. 8. Source and Amount of Consideration; Terms of New Options. Consideration. We will issue new options to purchase common stock under the Answerthink Option Plan in exchange for outstanding eligible options properly tendered and accepted for exchange by us. The number of new options to be granted to each employee or member of our board of directors will be equal to 66 2/3% of the number of options tendered by such option holder and accepted for exchange, subject to adjustments for any stock splits, stock dividends and similar events. This means that for every three options that an option holder tenders and we accept for exchange, such option holder will receive two new options. However, we will not issue any options exercisable for fractional shares. Instead, we will round up to the nearest whole number. If we receive and accept tenders of all outstanding eligible options, we will grant new options to purchase a total of 8,234,334 shares of our common stock. The common stock issuable upon exercise of the new options will equal approximately 18.17% of the total shares of our common stock outstanding as of June 20, 2001. 18 Terms of New Options. The new options will be issued under the Answerthink Option Plan and a new option agreement between us and each option holder who has tendered options in the offer. The following description summarizes the material terms of the Answerthink Option Plan and the options to be granted under the Answerthink Option Plan. General. The maximum number of shares of common stock available for ------- issuance pursuant to the exercise of options granted under the Answerthink Option Plan is currently 20,000,000. The maximum number of shares subject to options that may be awarded to one person under the Answerthink Option Plan is 3,000,000. The Answerthink Option Plan permits the granting of options intended to qualify as incentive options under the Internal Revenue Code and the granting of options that do not qualify as incentive options. All of the new options granted pursuant to the offer will be nonqualified stock options. Administration. The Answerthink Option Plan is administered by the -------------- compensation committee of our board of directors. The compensation committee is composed of no fewer than two directors who are intended to be "non-employee directors" as defined in Rule 16b-3 under the Securities Exchange Act and "outside directors" for purposes of Section 162(m) of the Internal Revenue Code. The members of the compensation committee are appointed by the board to serve for such terms as the board may determine by resolution. The board may remove any member of the compensation committee or reconstitute the compensation committee with other directors, subject to the requirements of Rule 16b-3. Term. The term of each option will be fixed by the compensation ---- committee and may not exceed ten years from the date of grant. The new options to be granted pursuant to the offer will have a term of ten years from the date of grant of the option that was tendered for exchange. Exercise Price. The exercise price of each option will be determined by -------------- the compensation committee, but may not be less than the greater of the par value or 100% of the fair market value of a share of our common stock on the date of grant. The exercise price of the new options to be granted pursuant to the offer will be equal to the last reported sale price of our common stock on Nasdaq, or such other national securities exchange or interdealer quotation system on which our common stock is then traded, on the date of grant or, if the grant date is not a business day, as of the last business day preceding the grant date. Termination. Options issued under the Answerthink Option Plan generally ----------- expire ten years after the date of grant. However, new options granted pursuant to the offer will expire ten years from the date of grant of the option that was tendered for exchange. If your employment with us terminates for any reason other than by reason of death or "permanent and total disability" (as defined in the Answerthink Option Plan), any option or portion thereof held by you that is not yet vested will terminate immediately upon such termination. Any option or portion thereof held by you that has vested but has not been exercised upon such termination will terminate at the close of business on the 90th day following your termination of employment (or if such 90th day is a Saturday, Sunday or 19 holiday, at the close of business on the next preceding day that is not a Saturday, Sunday or holiday), unless the compensation committee, in its discretion, extends the period during which the option may be exercised (which period may not extend beyond the original term of the option). In the event that the termination of your employment is by reason of death, all options granted to you will fully vest on the date of death, and your executors, administrators, legatees or distributees of your estate may exercise any option held by you. This right to exercise options will extend to the earlier of the expiration of the option term or one year after the date of death. In the event that the termination of your employment is by reason of permanent and total disability, all options granted to you will continue to vest, and shall be exercisable to the extent that they are vested, to the earlier of the expiration of the option term or one year after the date of such termination. Vesting and Exercise. The compensation committee will determine at what -------------------- time or times each option may be exercised and the period of time, if any, after retirement, death, disability or termination of employment during which options may be exercised. The exercisability of options may be accelerated by the compensation committee. Additionally, upon the occurrence of a "change of control" (as defined in the Answerthink Option Plan), if no provision is made to continue the Answerthink Option Plan or assume or replace the outstanding options with new options of a successor entity, then fifteen days prior to the consummation of the change of control, all options become immediately exercisable and remain exercisable for a period of fifteen days. Upon consummation of the change of control, the Answerthink Option Plan and all outstanding but unexercised options terminate. The new options granted to you will have the same vesting schedule, measured from the same grant date, as the options tendered by you and accepted for exchange. Here is an example of how the vesting schedule will work: Original Grant Surrendered by Associate - --------------------------------------- 3,000 options granted on August 31, 1999 Vesting Schedule Options Strike Price - ---------------- ------- ------------ 50% after 2 years (August 2001) 1,500 $25.00 25% August 2002 750 $25.00 25% August 2003 750 $25.00 New Grant to be Received by Associate - ------------------------------------- 2,000 options granted on February 9, 2002 (projected grant date) Vesting Schedule Options Strike Price - ---------------- ------- ------------ 50% fully vested (August 2001) 1,000 February 8, 2002 closing price 25% vested August 2002 500 February 8, 2002 closing price 25% vested August 2003 500 February 8, 2002 closing price 20 Payment of Exercise Price. You may exercise your options, in whole or in ------------------------- part, by delivery of a written notice to us on any business day at our principal office which specifies the number of shares for which the option is being exercised and which is accompanied by payment in full of the applicable exercise price, including any federal and other taxes which in our judgment we may be required to withhold with respect to the exercise of your option. In general, an option holder may pay the exercise price of an option by cash or certified check, by tendering shares of our common stock (which, if acquired from us, have been held by the option holder for at least six months, having a fair market value on the date of exercise equal to the aggregate exercise price), or by means of a broker-assisted cashless exercise. Transferability of Options. New options are personal to the option -------------------------- holder and may not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) other than by will or the laws of descent and distribution. However, we may permit limited transfers of nonqualified options for the benefit of immediate family members of option holders to help with estate planning concerns. During your lifetime, only you, or your guardian or legal representative in the case of your incapacity or incompetency, may exercise options granted to you. Registration of Option Shares. All shares of common stock issuable upon exercise of options under the Answerthink Option Plan, including the shares that will be issuable upon exercise of all new options to be granted pursuant to the offer, have been registered under the Securities Act on a registration statement on Form S-8 filed with the SEC. Unless you are one of our affiliates, you will be able to sell your option shares free of any transfer restrictions under applicable securities laws. Incentive Stock Options. If you hold an incentive stock option that has an exercise price of $10.00 per share or more and do not tender the incentive stock option pursuant to this offer, your incentive stock option will be treated as a new grant of an option. The fact that your incentive stock option is treated as a new grant of an option has two effects. First, your incentive stock option must be re-tested at the time of the offer to determine if the terms of the option permit the option to qualify as an incentive stock option. One of the requirements for qualifying as an incentive stock option is that the option cannot first become exercisable for more than $100,000 worth of shares (calculated as the fair market value of a share of the common stock at the time of the option grant multiplied by the number of shares subject to the option) in a single calendar year. Any portion of your option that exceeds this $100,000 limit will be deemed to be a non-incentive stock option. Another requirement is that the exercise price cannot exceed the fair market value of the shares subject to the option at the time of the new option grant. Assuming your option is re-tested and qualifies as an incentive stock option, the second effect of a refusal to tender your incentive stock option is that the statutory holding period for that option will begin on the date of the offer. This is because the offer is treated as the grant of a new incentive stock option for purposes of the statutory holding period requirements. Therefore, in order to be eligible for favorable tax treatment, you must hold any stock purchased on exercise of the incentive stock option for two years after the date of this offer or, if later, one year after the option is exercised. 21 Federal Income Tax Consequences of Nonqualified Stock Options. Under current law, an option holder will not realize taxable income upon the grant of a nonqualified stock option having an exercise price substantially equal to the fair market value on the grant date of the stock subject to the option. However, when an option holder exercises the option, the difference between the exercise price of the option and the fair market value of the shares subject to the option on the date of exercise will be compensation income taxable to the option holder. We will be entitled to a deduction equal to the amount of ordinary income taxable to the option holder if we comply with applicable reporting requirements. An option holder who has transferred a nonqualified stock option to a family member by gift will realize taxable income at the time the option is exercised by the family member. The option holder will be subject to withholding of income and employment taxes at that time. The family member's tax basis in the shares will be the fair market value of the shares on the date the option is exercised. If you tender shares in payment of part or all of the exercise price of a nonqualified stock option, no gain or loss will be recognized with respect to the shares tendered, regardless of whether the shares were acquired pursuant to the exercise of an incentive stock option, and you will be treated as receiving an equivalent number of shares pursuant to the exercise of the option in a nontaxable exchange. The tax basis of the shares tendered will be treated as the substituted tax basis for an equivalent number of shares received, and the new shares will be treated as having been held for the same holding period as the holding period that expired with respect to the transferred shares. The difference between the aggregate exercise price and the aggregate fair market value of the shares received pursuant to the exercise of the option will be taxed as ordinary income, just as if you had paid the exercise price in cash. Our statements in this offer to exchange concerning the Answerthink Option Plan and the new options are merely summaries and do not purport to be complete. The statements are subject to, and are qualified in their entirety by reference to, all provisions of the Answerthink Option Plan and the appropriate form of option agreement under the Answerthink Option Plan. Please contact us at Answerthink, Inc., Human Resources, Attn: Robert Greene, 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263) to receive a copy of the Answerthink Option Plan and the form of option agreement thereunder. We will promptly furnish you copies of these documents at our expense. 9. Information Concerning Answerthink. General. We are a leading provider of technology-enabled business transformation solutions. We bring together multi-disciplinary expertise in benchmarking and research, business transformation, interactive marketing, business applications and technology integration to serve the needs of Global 2000 clients. Our solutions span all functional areas of a company including finance, human resources, information technology, sales, marketing, customer service, and supply chain across a variety of industry sectors such as telecommunications, utilities, automotive, financial services, retail, consumer packaged goods, life sciences and manufacturing. As of March 31, 2001, we had approximately 1600 employees. 22 Answerthink was incorporated in the State of Florida in 1997. Our principal executive offices are located at 1001 Brickell Bay Drive, Suite 3000, Miami, Florida 33131, and our telephone number at that address is (305) 375- 8005. Financial Information. The following table sets forth selected consolidated financial and operating data for Answerthink. The selected historical statement of operations data for the years ended December 31, 1999 and December 29, 2000 and the selected historical balance sheet data as of December 29, 2000 have been derived from the consolidated financial statements included in our annual report on Form 10-K for the year ended December 29, 2000 that have been audited by PricewaterhouseCoopers LLP, independent public accountants. The selected historical statement of operations data for the three months ended March 31, 2000 and March 30, 2001 and the selected historical balance sheet data as of March 30, 2001, which are included in our quarterly report on Form 10-Q for the quarter ended March 30, 2001, are unaudited, but include, in the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of such data. 23 The information presented below should be read together with our consolidated financial statements and related notes. We have presented the following data in thousands, except per share amounts.
Year Ended Three Months Ended ----------------------------- ---------------------------- December 31, December 29, March 31, March 30, 1999 2000 2000 2001 ----------------------------- ---------------------------- (unaudited) Income Statement Data: Net revenues................................................. $260,460 $311,136 $ 76,297 $ 72,015 Costs and expenses: Project personnel and expenses............................. 154,531 182,191 44,741 45,381 Selling, general and administrative expenses............... 83,661 114,733 22,538 24,401 Stock compensation expense................................. -- -- 213 3,031 Merger related expenses.................................... 11,700 -- -- -- ----------------------- ------------------------- Total costs and operating expenses...................... 249,892 296,924 67,492 72,813 ----------------------- ------------------------- Income (loss) from operations.............................. 10,568 14,212 8,805 (798) Other income (expense): Litigation settlement...................................... -- 1,850 -- -- Non-cash investment losses................................. -- (2,350) -- -- Interest income............................................ 926 1,383 359 476 Interest expense........................................... (645) (255) (87) (42) ----------------------- ------------------------- Income (loss) before income taxes and extraordinary loss... 10,849 14,840 9,077 (364) Income taxes................................................. 7,602 6,939 3,722 (164) ----------------------- ------------------------- Income (loss) before extraordinary loss...................... 3,247 7,901 5,355 (200) Extraordinary loss on early extinguishment of debt........... 2,113 -- -- -- ----------------------- ------------------------- Net income (loss)............................................ $ 1,134 $ 7,901 $ 5,355 $ (200) ======================= ========================= Basic net income (loss) per common share: Income (loss) before extraordinary loss..................... $ 0.09 $ 0.20 $ 0.14 $ -- Extraordinary loss on early extinguishment of debt.......... $ (0.06) $ -- $ -- $ -- Net income (loss) per common share.......................... $ 0.03 $ 0.20 $ 0.14 $ -- Weighted average common shares outstanding................... 34,953 40,262 37,818 42,181 Diluted net income (loss) per common share: Income (loss) before extraordinary loss..................... $ 0.08 $ 0.18 $ 0.12 $ -- Extraordinary loss on early extinguishment of debt.......... $ (0.05) $ -- $ -- $ -- Net income (loss) per common share.......................... $ 0.03 $ 0.18 $ 0.12 $ -- Weighted average common and common equivalent shares outstanding................................................ 43,098 45,137 45,055 42,181 Other Financial Data: Capital expenditures......................................... $ 5,285 $ 8,920 $ 1,935 $ 4,089 Cash flows provided by (used in) operating activities........ $ 7,313 $ 20,159 $ (8,164) $ (8,546) Cash flows used in investing activities...................... $ 17,635 $ 11,048 $ 4,732 $ 4,089 Cash flows provided by financing activities.................. $ 515 $ 15,427 $ 9,532 $ 1,102 Balance Sheet Data (at period end): Cash and cash equivalents.................................... $ 27,124 $ 51,662 $ 23,760 $ 40,129 Working capital.............................................. $ 55,166 $ 73,337 $ 67,419 $ 81,350 Total assets................................................. $200,713 $228,676 $214,629 $220,152 Stockholders' equity......................................... $140,270 $172,054 $163,366 $181,124
24 See "Additional Information" beginning on page 23 for instructions on how you can obtain copies of our SEC reports that contain the audited financial statements and unaudited financial data we have summarized above. 10. Interests of Directors and Officers; Transactions and Arrangements Concerning the Options. A list of our directors and executive officers is attached to this offer to exchange as Schedule A. As of June 20, 2001, our directors and executive officers as a group beneficially owned options outstanding under the Plans to purchase a total of 515,000 shares of our common stock, which represented approximately 4.13% of the shares subject to all options outstanding under the Plans as of that date. All of the outstanding options held by our directors and executive officers are eligible to be tendered in the offer. For information with respect to beneficial ownership by our directors and executive officers of our common stock, please refer to our definitive proxy statement, filed with the SEC on April 6, 2001. Except as described below, based upon our records and upon information provided to us by our directors, executive officers, associates and subsidiaries, neither we nor, to the best of our knowledge, any of our directors or executive officers or any of our subsidiaries nor any associates or subsidiaries of any of the foregoing, has effected any transactions in the options or our common stock during the 60 days prior to the date hereof. Mr. Allan Frank, a director and the president of Answerthink, had the following transactions in our common stock: (i) sold 5,000 shares at a price of $5.00 per share on May 15, 2001; (ii) sold 5,000 shares at a price of $5.03 per share on May 15, 2001; (iii) sold 5,000 shares at a price of $5.05 per share on May 16, 2001; (iv) sold 5,000 shares at a price of $5.10 per share on May 16, 2001; (v) sold 2,800 shares at a price of $5.25 per share on May 16, 2001; (vi) sold 100 shares at a price of $5.26 per share on May 16, 2001; (vii) sold 2,000 shares at a price of $5.27 per share on May 16, 2001; (viii) sold 100 shares at a price of $5.28 per share on May 16, 2001; (ix) sold 5,000 shares at a price of $5.70 per share on May 17, 2001; (x) sold 10,000 shares at a price of $5.80 per share on May 17, 2001; (xi) sold 15,000 shares at a price of $5.90 per share on May 18, 2001; (xii) sold 9,500 shares at a price of $5.95 per share on May 18, 2001; and (xiii) sold 500 shares at a price of $5.96 per share on May 18, 2001. On May 11, 2001, Mr. Robert Bahash, one of our directors, purchased 20,000 shares of our common stock at a price of $5.08 per share. We have been advised that our executive officers and directors intend to tender options pursuant to this offer. Except for outstanding options to purchase common stock and restricted stock awards granted from time to time to certain of our employees (including executive officers) and non-employee directors pursuant to the Answerthink Option Plan, the Answerthink, Inc. Employee Stock Purchase Plan, and except as set forth in this offer to exchange, neither we nor any person controlling us nor, to our knowledge, any of our directors or executive officers, is a party to any contract, arrangement, understanding or relationship with any other person relating, directly or indirectly, to the offer with respect to any of our securities (including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or the voting of any such securities, joint ventures, 25 loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving or withholding of proxies, consents or authorizations). 11. Status of Options Acquired by Us in the Offer; Accounting Consequences of the Offer. Options we acquire pursuant to the offer will be canceled, and the shares of common stock subject to those options will be returned to the pool of shares available for grants of new options and for issuance upon the exercise of such new options. To the extent such shares are not fully reserved for issuance upon exercise of the new options to be granted in connection with the offer, the shares will be available for future awards to employees and other eligible plan participants without further shareholder action, except as required by applicable law or the rules of Nasdaq or any other securities quotation system or any stock exchange on which our common stock is then quoted or listed. We believe that Answerthink will not incur any compensation expense solely as a result of the transactions contemplated by the offer because: . we will not grant any new options until a day that is at least six months and one day after the date that we accept and cancel options tendered for exchange; and . the exercise price of all new options will equal the market value of the common stock on the date we grant the new options or, if the grant date is not a business day, as of the last business day preceding the grant date. However, if we were to grant any options before expiration of the six- month period just described to option holders who have agreed to the cancellation, we would incur a compensation expense if the new grant were to have an exercise price less than the exercise price of any options tendered for cancellation and exchange. A new grant of this kind during the six-month period would be treated for financial reporting purposes as a variable award to the extent of the number of the option holder's tendered option shares or, if less, the number of shares subject to the grant. In this event, on each of Answerthink's reporting dates between the date of the new grant and the date the option is exercised by the option holder (or is otherwise forfeited or expires), we would be required to record as a compensation expense the amount of any increase in the market value of the option spread from the last reporting date. 12. Legal Matters; Regulatory Approvals. We are not aware of any license or regulatory permit that appears to be material to our business that might be adversely affected by our exchange of options and issuance of new options as contemplated by the offer, or of any approval or other action by any government or governmental, administrative or regulatory authority or agency, domestic or foreign, that would be required for the acquisition or ownership of our options as contemplated herein. Should any such approval or other action be required, we presently contemplate that we will seek such approval or take such other action. We are unable to predict whether we may determine that we are required to delay the acceptance of options for exchange pending the outcome of any such matter. We cannot assure you that any such approval or other action, if needed, would be obtained or would be obtained without 26 substantial conditions or that the failure to obtain any such approval or other action might not result in adverse consequences to our business. Our obligation under the offer to accept tendered options for exchange and to issue new options for tendered options is subject to conditions, including the conditions described in section 6. 13. Material Federal Income Tax Consequences. The following is a general summary of the material federal income tax consequences of the exchange of options pursuant to the offer. This discussion is based on the Internal Revenue Code of 1986, as amended, its legislative history, Treasury Regulations thereunder and administrative and judicial interpretations thereof as of the date of the offer, all of which are subject to change, possibly on a retroactive basis. This summary does not discuss all of the tax consequences that may be relevant to you in light of your particular circumstances, nor is it intended to be applicable in all respects to all categories of option holders. The option holders who exchange outstanding options for new options will not be required to recognize income for federal income tax purposes at the time of the exchange. We believe that the exchange will be treated as a non-taxable exchange. At the date of grant of the new options, the option holders will not be required to recognize additional income for federal income tax purposes. The grant of options is not recognized as taxable income. Special tax considerations may be applicable to employees located abroad. We recommend that you consult your own tax advisor with respect to the federal, state and local tax consequences of participating in the offer. 14. Extension of Offer; Termination; Amendment. We reserve the right, in our discretion, at any time and from time to time, and regardless of whether or not any event set forth in section 6 has occurred or is deemed by us to have occurred, to extend the period of time during which the offer is open and thereby delay the acceptance for exchange of any options by giving oral or written notice of such extension to the option holders and making a public announcement thereof. We expressly reserve the right, in our reasonable judgment, prior to the expiration date to terminate or amend the offer and to postpone our acceptance and cancellation of any options tendered for exchange upon the occurrence of any of the conditions specified in section 6, by giving oral or written notice of such termination or postponement to the option holders and making a public announcement thereof. Our reservation of the right to delay our acceptance and cancellation of options tendered for exchange is limited by Rule 13e-4(f)(5) promulgated under the Securities Exchange Act, which requires that we must pay the consideration offered or return the options tendered promptly after termination or withdrawal of a tender offer. Subject to compliance with applicable law, we further reserve the right, in our discretion, and regardless of whether any event set forth in section 6 has occurred or is 27 deemed by us to have occurred, to amend the offer in any respect, including, without limitation, by decreasing or increasing the consideration offered in the offer to option holders or by decreasing or increasing the number of options being sought in the offer. Amendments to the offer may be made at any time and from time to time by public announcement of the amendment. In the case of an extension, the amendment must be issued no later than 9:00 a.m., Eastern Daylight time, on the next business day after the last previously scheduled or announced expiration date. Any public announcement made pursuant to the offer will be disseminated promptly to option holders in a manner, which may include an electronic mail message, reasonably designated to inform option holders of such change. Without limiting the manner in which we may choose to make a public announcement, except as required by applicable law, we have no obligation to publish, advertise or otherwise communicate any such public announcement other than by making a press release to the Dow Jones News Service. If we materially change the terms of the offer or the information concerning the offer, or if we waive a material condition of the offer, we will extend the offer to the extent required by Rules 13e-4(d)(2) and 13e-4(e)(3) under the Securities Exchange Act. These rules require that the minimum period during which an offer must remain open following material changes in the terms of the offer or information concerning the offer, other than a change in price or a change in percentage of securities sought, will depend on the facts and circumstances, including the relative materiality of such terms or information. If we decide to take any of the following actions, we will publish notice of such action and extend the offer for a period of ten business days after the date of such publication: (a) (1) we increase or decrease the amount of consideration offered for the options; (2) we decrease the number of options eligible to be tendered in the offer; or (3) we increase the number of options eligible to be tendered in the offer by an amount that exceeds 2% of the shares of common stock issuable upon exercise of the options that are subject to the offer immediately prior to the increase; and (b) the offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that notice of such increase or decrease is first published, sent or given in the manner specified in this section 14. 15. Fees and Expenses. We will not pay any fees or commissions to any broker, dealer or other person for soliciting tenders of options pursuant to this offer to exchange. 16. Additional Information. We have filed with the SEC a Tender Offer Statement on Schedule TO, of which this offer to exchange is a part, with respect to the offer. This offer to exchange does not contain all of the information contained in the Schedule TO and the exhibits to the 28 Schedule TO. We recommend that you review the Schedule TO, including its exhibits, before making a decision on whether to tender your options. The rules of the SEC allow us to "incorporate by reference" information into this document, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. This offer incorporates by reference the financial statements and the notes thereto contained in the documents listed below that have been previously filed with the SEC and any future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act, until completion of the offer: 1. our annual report on Form 10-K for our fiscal year ended December 29, 2000, filed with the SEC on March 29, 2001, including the information incorporated by reference in the Form 10-K from our definitive proxy statement for our 2001 annual meeting of shareholders, filed with the SEC on April 6, 2001; 2. our quarterly report on Form 10-Q for our fiscal quarter ended March 30, 2001, filed with the SEC on May 14, 2001; 3. the description of our common stock included in our registration statement on Form 8-A, which was filed with the SEC on May 21, 1998, including any amendments or reports we file for the purpose of updating that description; and 4. our registration statements on Form S-8, registering the shares to be issued under the Answerthink Option Plan, filed with the SEC on December 30, 1998, November 9, 1999, and June 16, 2000. The SEC file number for all of these filings other than our registration statements on Form 8-A and Form S-8 is 333-48123. The SEC file numbers for our registration statements on Form 8-A and Form S-8 are 0-24343, 333-69951, 333- 90635, and 333-39460, respectively. Our SEC filings may be examined, and copies may be obtained, at the following SEC public reference rooms: 450 Fifth Street, N.W. 7 World Trade Center 500 West Madison Street Room 1024 Suite 1300 Suite 1400 Washington, D.C. 20549 New York, New York 10048 Chicago, Illinois 60661 You may obtain information on the operation of the public reference rooms by calling the SEC at 1-800-SEC-0330. Our SEC filings are also available to the public on the SEC's Internet site at http://www.sec.gov. Our common stock is quoted on Nasdaq under the symbol "ANSR," and our SEC filings can be read at the following Nasdaq address: 29 Nasdaq Operations 1735 K Street, N.W. Washington, D.C. 20006 We will also provide without charge to each person to whom a copy of this offer to exchange is delivered, upon the written or oral request of any such person, a copy of any or all of the documents to which we have referred you, other than exhibits to such documents (unless such exhibits are specifically incorporated by reference into such documents). Requests should be directed to: Answerthink, Inc. Attention: Josie Estevez-Lugo 1001 Brickell Bay Drive Suite 3000 Miami, Florida 33131 or by telephoning us at (305) 375-8005, extension 1084 between the hours of 9:00 a.m. and 5:00 p.m., Florida local time. As you read the foregoing documents, you may find some inconsistencies in information from one document to another. If you find inconsistencies between the documents, or between a document and this offer to exchange, you should rely on the statements made in the most recent document. The information contained in this offer to exchange about Answerthink should be read together with the information contained in the documents to which we have referred you. 17. Miscellaneous. This offer to exchange and our SEC reports referred to above include "forward-looking statements." When used in this offer to exchange, the words "anticipate," "believe," "estimate," expect," "intend" and "plan" as they relate to Answerthink or our management are intended to identify these forward-looking statements. All statements by us regarding our expected future financial position and operating results, our business strategy, our financing plans and expected capital requirements, forecasted trends relating to our services or the markets in which we operate and similar matters are forward-looking statements. Pursuant to Sections 27A(b)(2)(C) of the Securities Act and 21E(b)(2)(C) of the Exchange Act, the safe harbor for forward-looking statements provided in the Private Securities Litigation Reform Act of 1995 does not apply to statements made in connection with a tender offer such as the offer made hereby. The documents we have filed with the SEC, including our Registration Statement on Form S-3 (Registration Form 333-32342), discuss some of the risks that could cause our actual results to differ from those contained or implied in the forward-looking statements. These risks and uncertainties include, but are in no way limited to our ability to attract additional business, the potential for contract cancellation by our customers, changes in expectations regarding the information technology industry, our ability to attract and retain skilled employees, possible changes in collections of accounts receivable, risks of competition, price and margin trends, and changes in general economic conditions. We undertake no obligation to update or revise 30 publicly any forward-looking statements, whether as a result of new information, future events or otherwise. We are not aware of any jurisdiction where the making of the offer is not in compliance with applicable law. If we become aware of any jurisdiction where the making of the offer is not in compliance with any valid applicable law, we will make a good faith effort to comply with such law. If, after such good faith effort, we cannot comply with such law, the offer will not be made to, nor will tenders be accepted from or on behalf of, the option holders residing in such jurisdiction. We have not authorized any person to make any recommendation on our behalf as to whether you should tender or refrain from tendering your options pursuant to the offer. You should rely only on the information contained in this document or to which we have referred you. We have not authorized anyone to give you any information or to make any representations in connection with the offer other than the information and representations contained in this document or in the related letter of transmittal. If anyone makes any recommendation or representation to you or gives you any information, you must not rely upon that recommendation, representation or information as having been authorized by us. Answerthink, Inc. June 27, 2001 31 SCHEDULE A Information Concerning the Directors and Executive Officers of Answerthink, Inc. The directors and executive officers of Answerthink and their positions and offices as of June 27, 2001 are set forth in the following table: Name Position and Offices Held - ---- ------------------------- Ted A. Fernandez Director, Chairman and Chief Executive Officer Robert J. Bahash Director John F. Brennan Executive Vice President and Chief Financial Officer David N. Dungan Director and Chief Operating Officer Allan R. Frank Director and President Edwin A. Huston Director Jeffrey E. Kiesling Director Alan T.G. Wix Director The address of Messrs. Fernandez, Brennan, Dungan, Frank and Huston is c/o Answerthink, Inc., 1001 Brickell Bay Drive, Suite 3000, Miami, Florida 33131. The address of Mr. Bahash is 1221 Avenue of the Americas, 49th Floor, New York, New York 10020. The address of Mr. Keisling is 150 N. Radnor-Chester Road, St. Davids, Pennsylvania 19087. The address of Mr. Wix is 99 Merewood Road, Barnehurst, Kent, England DA7 6PH. A-1 [Name of Optionee] SCHEDULE B Options exercisable and available as of 6/27/01
- ------------------------------------------------------------------------------------------------------------------------------------ Grant Expiration Grant Options Option Options Options Options Date Date Plan ID Type Granted Price Outstanding Vested Exercisable - ------------------------------------------------------------------------------------------------------------------------------------ [Option information for Optionee] - ------------------------------------------------------------------------------------------------------------------------------------
Totals B-1 ================================================================================ OFFER TO EXCHANGE OUTSTANDING OPTIONS FOR NEW OPTIONS GRANTED UNDER THE ANSWERTHINK, INC. 1998 STOCK OPTION AND INCENTIVE PLAN OF ANSWERTHINK, INC. ___________ Any questions or requests for assistance or additional copies of any documents referred to in the offer to exchange may be directed to Human Resources, Attn: Robert Greene at Answerthink, Inc., 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263). ___________ June 27, 2001 ================================================================================ EX-99.A.2 3 dex99a2.txt EXHIBIT (A)(2) Exhibit (a)(2) -------------- ANSWERTHINK, INC. LETTER OF TRANSMITTAL Offer to Exchange Options Pursuant to the Offer to Exchange Dated June 27, 2001 - -------------------------------------------------------------------------------- THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., EASTERN DAYLIGHT TIME, ON WEDNESDAY, AUGUST 8, 2001, UNLESS THE OFFER IS EXTENDED. - -------------------------------------------------------------------------------- To: Answerthink, Inc. Human Resources Attn: Robert Greene 817 W. Peachtree Street Suite 800 Atlanta, Georgia 30308 Telephone: (404) 682-2263 Delivery of this Letter of Transmittal to an address other than as set forth above will not constitute a valid delivery. - -------------------------------------------------------------------------------- Pursuant to the terms and subject to the conditions of the Offer to Exchange dated June 27, 2001 and this Letter of Transmittal, I hereby tender the follow options (to validly tender such options, you must complete the following table according to instructions 2 and 3 on page 4 of this Letter of Transmittal): - -------------------------------------------------------------------------------- Grant Date of Total Number of Option/1/ Exercise Price of Option Unexercised Options - - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ________________ /1/ List each option grant on a separate line even if more than one option - - grant was issued on the same grant date. To Answerthink, Inc.: Upon the terms and subject to the conditions set forth in the Offer to Exchange dated June 27, 2001 (the "Offer to Exchange"), my receipt of which I hereby acknowledge, and in this Letter of Transmittal (this "Letter" which, together with the Offer to Exchange, as they may be amended from time to time, constitutes the "Offer"), I, the undersigned, hereby tender to Answerthink, Inc., a Florida corporation (the "Company"), the options to purchase shares ("Option Shares") of common stock, par value $.001 per share, of the Company (the "Common Stock") specified in the table on page 1 of this Letter (the "Options") in exchange for "New Options," which are new options to purchase shares of Common Stock equal in number to 662/3% of the number of Option Shares subject to the Options that I tender hereby. All New Options will be subject to the terms of the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Answerthink Option Plan") and to a new option agreement between the Company and me. Subject to, and effective upon, the Company's acceptance for exchange of the Options tendered herewith in accordance with the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment), I hereby sell, assign and transfer to, or upon the order of, the Company all right, title and interest in and to all of the Options that I am tendering hereby. I acknowledge that the Company has advised me to consult with my own advisors as to the consequences of participating or not participating in the Offer. I agree that this Letter is an amendment to the option agreement or agreements to which the Options I am tendering hereby are subject. I hereby represent and warrant that I have full power and authority to tender the Options tendered hereby and that, when and to the extent such Options are accepted for exchange by the Company, such Options will be free and clear of all security interests, liens, restrictions, charges, encumbrances, conditional sales agreements or other obligations relating to the sale or transfer thereof, other than pursuant to the applicable option agreement, and such Options will not be subject to any adverse claims. Upon request, I will execute and deliver any additional documents deemed by the Company to be necessary or desirable to complete the exchange of the Options I am tendering hereby. All authority herein conferred or agreed to be conferred shall not be affected by, and shall survive, my death or incapacity, and all of my obligations hereunder shall be binding upon my heirs, personal representatives, successors and assigns. Except as stated in the Offer, this tender is irrevocable. By execution hereof, I understand that tenders of Options pursuant to the procedure described in Section 3 of the Offer to Exchange and in the instructions to this Letter will constitute my acceptance of the terms and conditions of the Offer. The Company's acceptance for exchange of Options tendered pursuant to the Offer will constitute a binding agreement between the Company and me upon the terms and subject to the conditions of the Offer. I also understand that the Company will not issue any New Options exercisable for fractional shares, and, instead, will round up to the nearest whole number. I acknowledge that the New Options that I will receive (1) will not be granted until on or about the first day that is at least six months and one day after the date the Options tendered hereby are accepted for exchange and canceled and (2) will be subject to the terms and conditions set forth in a new option agreement between the Company and me that will be forwarded to me after the grant of the New Options. I also acknowledge that I must be an employee or a member of the board of directors of the Company from the date I tender Options through the date the New Options are granted, other than if my term of office as a director expires, and otherwise be eligible under the Answerthink Option Plan on the date the New Options are granted in order to receive New Options. I further acknowledge that, if I do not remain such an employee or member of the board of directors, other than if my term of office as a director expires, I will not receive any New Options or any other consideration for the Options that I tender and that are accepted for exchange pursuant to the Offer. The name of the registered holder of the Options tendered hereby appears below exactly as it appears on the option agreement or agreements representing such Options. In the appropriate boxes of the table, I have listed for each Option the grant date, the exercise price and the total number of Option Shares subject to the Option I am tendering. I understand that I may tender (i) all or any of my nonqualified options outstanding under the Answerthink Option Plan, the Think New Ideas, Inc. Amended and Restated 1997 Option Plan and the Think New Ideas, Inc. Amended and Restated 1998 Option Plan and (ii) all or any of my outstanding incentive stock options that have an exercise price of $10.00 per share or more outstanding under the Answerthink Option Plan, the Think New Ideas, Inc. Amended and Restated 1997 Option Plan and the Think New Ideas, Inc. Amended and Restated 1998 Option Plan and that I am not required to tender any of such options in the Offer. However, I also understand that if I choose to participate in the offer, I must tender all options that I received during the six months immediately prior to the "Expiration Date" of the offer, as defined below, currently expected to be August 8, 2001, if 2 those grants were made subsequent to and have an exercise price lower than the exercise price of the options that I wish to replace. I also understand that the Company will not accept partial tenders of unexercised options of an individual option grant. I also understand that all of such Options properly tendered prior to the "Expiration Date" and not properly withdrawn will be exchanged for New Options, upon the terms and subject to the conditions of the Offer, including the conditions described in Sections 1 and 6 of the Offer to Exchange. The term "Expiration Date" means 5:00 p.m., Eastern Daylight time, on August 8, 2001, unless and until the Company, in its discretion, has extended the period of time during which the Offer will remain open, in which event the term "Expiration Date" refers to the latest time and date at which the Offer, as so extended, expires. I recognize that, under certain circumstances set forth in the Offer to Exchange, the Company may terminate or amend the Offer and postpone its acceptance and cancellation of any Options tendered for exchange. In any such event, I understand that the Options delivered herewith but not accepted for exchange will be returned to me at the address indicated below. The Offer is not being made to (nor will tenders of Options be accepted from or on behalf of) holders in any jurisdiction in which the making or acceptance of the Offer would not be in compliance with the laws of such jurisdiction. All capitalized terms used in this Letter but not defined shall have the meaning ascribed to them in the Offer to Exchange. I have received the documents regarding the Offer and agree to all of the terms and conditions of the Offer. HOLDER PLEASE SIGN HERE (See Instructions 1 and 4) You must complete and sign the following exactly as your name appears on the option agreement or agreements evidencing the Options you are tendering. If the signature is by a trustee, executor, administrator, guardian, attorney-in- fact, officer of a corporation or another person acting in a fiduciary or representative capacity, please set forth the signer's full title and include with this Letter proper evidence of the authority of such person to act in such capacity. ============================================================ SIGNATURE OF OWNER X________________________________________________________ (Signature of Holder or Authorized Signatory) Date:___________ ____, 2001 Name:____________________________________________________ (Please Print) Capacity (if signing as trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity): _________________________________________________________ Address:_________________________________________________ (Please include ZIP code) Telephone No. (with area code): _________________________________________________________ Tax ID/ Social Security No.:_____________________________ ============================================================ 3 INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. Delivery of Letter of Transmittal. A properly completed and duly --------------------------------- executed original of this Letter must be received by the Company at its address set forth on the front cover of this Letter on or before the Expiration Date. The method by which you deliver your properly completed and duly executed Letter of Transmittal is at your option and risk, and the delivery will be deemed made only when actually received by the Company. If you elect to deliver your Letter by mail, the Company recommends that you use registered mail with return receipt requested and that you properly insure the document. In all cases, you should allow sufficient time to ensure timely delivery. Tenders of Options made pursuant to the Offer may be withdrawn at any time prior to the Expiration Date. If the Offer is extended by the Company beyond that time, you may withdraw your tendered options at any time until the extended expiration of the Offer. In addition, unless the Company accepts your tendered Options for exchange before 12:00 midnight, Eastern Daylight time, on August 22, 2001, you may withdraw your tendered options at any time after August 22, 2001. To withdraw tendered Options, you must deliver a written notice of withdrawal with the required information to the Company while you still have the right to withdraw the tendered Options. Withdrawals may not be rescinded and any Options withdrawn will thereafter be deemed not properly tendered for purposes of the Offer unless such withdrawn Options are properly re-tendered prior to the Expiration Date by following the procedures described above. The Company will not accept any alternative, conditional or contingent tenders. All tendering option holders, by execution of this Letter, waive any right to receive any notice of the acceptance of their tender, except as provided for in the Offer to Exchange. 2. Inadequate Space. If the space provided herein is inadequate, the ---------------- information requested by the first table in this Letter regarding the Options to be tendered should be provided on a separate schedule attached hereto. 3. Tenders. If you intend to tender options pursuant to the Offer, you ------- must complete the table on page 1 of this Letter by providing the following information for each Option that you intend to tender: grant date, exercise price and total number of unexercised options subject to the Option that you are tendering. You must tender the entire unexercised portion of an option grant. The Company will not accept partial tenders of the unexercised portion of an individual option grant. If you choose to participate in the offer, you must also tender all options that you received during the six months immediately prior to the expiration date of the offer, currently expected to be August 8, 2001, if those grants were made subsequent to and have an exercise price lower than the exercise price of the options that you wish to replace. 4. Signatures on Letter of Transmittal. If this Letter is signed by the ----------------------------------- holder of the Options, the signature must correspond with the name as written on the face of the option agreement or agreements to which the Options are subject without alteration, enlargement or any change whatsoever. If this Letter is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to the Company of the authority of such person so to act must be submitted with this Letter. 5. Requests for Assistance or Additional Copies. Any questions or -------------------------------------------- requests for assistance, as well as requests for additional copies of the Offer to Exchange or this Letter, may be directed to Answerthink, Inc., Human Resources, Attn: Robert Greene, 817 W. Peachtree Street, Suite 800, Atlanta, Georgia 30308 (telephone: (404) 682-2263). Copies will be furnished promptly at the Company's expense. 6. Irregularities. All questions as to the number of Option Shares subject -------------- to Options to be accepted for exchange and the validity, form, eligibility (including time of receipt) and acceptance for exchange of any tender of Options will be determined by the Company in its discretion, which determinations shall be final and binding on all parties. The Company reserves the right to reject any or all tenders of Options the Company determines not to be in proper form or the acceptance of which may, in the opinion of the Company's counsel, be unlawful. The Company also reserves the right to waive any of the conditions of the Offer and any defect or irregularity in the tender of any particular Options, and the Company's interpretation of the terms of the Offer (including these instructions) will be final and binding on all parties. No tender of Options will be deemed to be properly made until all defects and irregularities have been cured or waived. Unless 4 waived, any defects or irregularities in connection with tenders must be cured within such time as the Company shall determine. Neither the Company nor any other person is or will be obligated to give notice of any defects or irregularities in tenders, and no person will incur any liability for failure to give any such notice. 7. Important Tax Information. You should refer to Section 13 of the Offer ------------------------- to Exchange, which contains important tax information. Important: This Letter of Transmittal must be received by the Company on or prior to the Expiration Date. 5 EX-99.A.3 4 dex99a3.txt EXHIBIT (A)(3) Exhibit (a)(3) -------------- [Letterhead of Answerthink, Inc.] 1001 Brickell Bay Drive Suite 3000 Miami, Florida 33131 June 27, 2001 Dear option holder: I am happy to announce that we are offering to exchange any of your (i) outstanding incentive stock options that have an exercise price of $10.00 per share or more (only the associates that joined Answerthink as part of the merger with THINK New Ideas, Inc. should have incentive stock options) and (ii) outstanding nonqualified options for new options that we will grant under the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Answerthink Option Plan"). You may tender (surrender) any or all of your eligible incentive stock option grants and any or all of your nonqualified option grants. However, you must tender all or none of the unexercised options subject to an individual option grant. If you choose to participate in the offer, you must also tender all options that you received during the six months immediately prior to the expiration date of the offer, currently expected to be August 8, 2001, if those grants were made subsequent to and have an exercise price lower than the exercise price of the options that you wish to replace. Please note, if you received an end of year 2000 performance grant and/or an Employee Stock Purchase Plan special grant, you do not have to tender these options as they fall outside the six-month period. The number of new options you will be granted will be equal to 66 2/3% of the number of options you tender and are accepted for exchange. This means that for every three options to purchase common stock that you tender and we accept for exchange, you will receive two new options to purchase common stock. We will not, however, issue any new options exercisable for fractional shares. Instead, we will round up to the nearest whole number. The number new options will be adjusted for any stock splits, stock dividends and similar events completed after the expiration date and prior to the issuance of the new options. We will grant the new options on or about the day which is at least six months and one day following the date we cancel the options accepted for exchange. You must be an employee of Answerthink from the date you tender options through the date we grant the new options in order to receive the new options. If you do not remain an employee , you will not receive any new options or any other consideration for the options tendered by you and canceled by Answerthink. The per share exercise price of all new options will equal the last reported sale price of our common stock on the Nasdaq Stock Market's National Market on the date we grant the new options, or if the grant date is not a business day, as of the last business day preceding the grant date. The new options granted to you will have the same vesting schedule, measured from the same grant date, as the options tendered by you and accepted for exchange. The new options will be subject to the terms of the Answerthink Option Plan and a new option agreement between you and us. We will forward the new option agreement to you promptly following the issuance of the new options. The board of directors makes no recommendation as to whether you should tender or refrain from tendering your options in the offer. You must make your own decision on whether to tender your options. This offer is being made under the terms and subject to the conditions of an Offer to Exchange and a related Letter of Transmittal which are enclosed with this letter. You should carefully read the entire Offer to Exchange and Letter of Transmittal before you decide whether to tender all or any portion of your options. A tender of options involves risks that are discussed in the offer to exchange. To tender options, you will be required to properly complete and return to us the Letter of Transmittal by the expiration date of the offer. If you have any questions about the offer, please call Robert Greene at (404) 682-2263. We thank you for your continued efforts on behalf of Answerthink, Inc. Sincerely, /s/ Ted A. Fernandez Ted A. Fernandez Chairman and Chief Executive Officer Enclosures EX-99.A.4 5 dex99a4.txt EXHIBIT (A)(4) Exhibit (a)(4) -------------- [Electronic Mail Message to Eligible Option Holders] Stock Option Exchange Program Details for Exchange Below Today we will be mailing you detailed information regarding the Stock Option Exchange Program. The information will include all of the documentation needed to tender (surrender) your options. You will receive four documents. Three of the documents are attached to this message - an Introductory Letter from Ted, the Offer to Exchange and Letter of Transmittal. The fourth document is Schedule B which contains information on your personal stock options - that document obviously cannot be included here and will be mailed only. We will be offering to exchange any of your outstanding "nonqualified" stock options. Nonqualified stock options are those you would have received upon joining Answerthink or as performance options. For those of you who joined Answerthink as part of the merger with THINK New Ideas, Inc. and have "incentive" stock options, we will be offering to exchange outstanding incentive stock options that have an exercise price of $10.00 per share or more. The Schedule B that is being mailed to you will indicate which of your options are incentive stock options and which are nonqualified stock option. We expect you to receive these materials on or about Friday, July 6. If they have not arrived by that date you may contact Robert Greene at (404) 682-2263 to obtain a copy of your Schedule B. EX-99.A.5 6 dex99a5.txt EXHIBIT (A)(5) Exhibit (a)(5) -------------- [Letterhead of Answerthink, Inc.] 1001 Brickell Bay Drive Suite 3000 Miami, Florida 33131 August __, 2001 Dear option holder: On behalf of Answerthink, Inc., I am writing to provide you with the results of Answerthink's recent offer to exchange (the "Offer") your (i) outstanding incentive stock options that have an exercise price of $10.00 per share or more and (ii) outstanding nonqualified options for new options to be granted under the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Answerthink Option Plan"). The Offer expired at 5:00 p.m., Eastern Daylight time, on August 8, 2001. Promptly following the expiration of the Offer and pursuant to the terms and conditions of the Offer, we accepted for exchange a total of _______ options to purchase shares of our common stock tendered to us and canceled all such options. The number of options that were tendered by you and that we accepted for exchange and canceled is set forth on Attachment A to this letter. In ------------ accordance with the terms and subject to the conditions of the Offer, you will have the right to receive new options equal to 66 2/3% of the number of options tendered by you and accepted for exchange, as adjusted for any stock splits, stock dividends and similar events. This number is also set forth on Attachment ---------- A. - - We will grant you the new options on or about February 9, 2002. The new options will be subject to the terms of the Answerthink Option Plan and a new option agreement between you and us. We will forward the new option agreements to you promptly following the issuance of the new options. The per share exercise price of the new options will equal the last reported sale price of our common stock on the Nasdaq Stock Market's National Market on the date we grant the new options, or if the grant date is not a business day, as of the last business day preceding the grant date. The new options granted to you will have the same vesting schedule and term, both measured from the same grant date, as the options tendered by you and accepted for exchange. You must be an employee from the date you tender options through the date we grant the new options in order to receive the new options. If you do not remain an employee, you will not receive any new options or any other consideration for the options tendered by you and canceled by Answerthink. If you have any questions about your rights in connection with the grant of the new options, please call Robert Greene at (404) 682-2263. Sincerely, Ted A. Fernandez Chairman and Chief Executive Officer Attachment 2 Attachment A Number of Options Number of New ----------------- ------------- Option Grant Date Accepted for Exchange Options to be Granted - ----------------- --------------------- --------------------- EX-99.D.1 7 dex99d1.txt EXHIBIT (D)(1) Exhibit (d)(1) -------------- ANSWERTHINK, INC. 1998 STOCK OPTION AND INCENTIVE PLAN Answerthink, Inc., a Florida corporation (the "Company"), sets forth herein the terms of its 1998 Stock Option and Incentive Plan (the "Plan") as follows: 1. PURPOSE The Plan is intended to enhance the Company's ability to attract and retain highly qualified officers, key employees, outside directors and other persons, and to motivate such officers, key employees, outside directors and other persons to serve the Company and its affiliates (as defined herein) and to expend maximum effort to improve the business results and earnings of the Company, by providing to such officers, key employees, outside directors and other persons an opportunity to acquire or increase a direct proprietary interest in the operations and future success of the Company. To this end, the Plan provides for the grant of stock options, restricted stock and restricted stock units in accordance with the terms hereof. Stock options granted under the Plan may be non-qualified stock options or incentive stock options, as provided herein, except that stock options granted to outside directors shall in all cases be non-qualified stock options. 2. DEFINITIONS For purposes of interpreting the Plan and related documents (including Award Agreements), the following definitions shall apply: 2.1 "Affiliate" of, or person "affiliated" with, a person means any company or other trade or business that controls, is controlled by or is under common control with such person within the meaning of Rule 405 of Regulation C under the Securities Act. 2.2 "Award Agreement" means the stock option agreement, restricted stock agreement, restricted stock unit agreement or other written agreement between the Company and a Grantee that evidences and sets out the terms and conditions of a Grant. 2.3 "Beneficial Owner" means a beneficial owner within the meaning of Rule 13d-3 under the Exchange Act. 2.4 "Benefit Arrangement" shall have the meaning set forth in Section 13 hereof. 2.5 "Board" means the Board of Directors of the Company. 2.6 "Change of Control" means (A) any Person, other than any Person who is a Beneficial Owner of the Company's securities before the Effective Date, becomes, after the Effective Date, the beneficial owner, directly or indirectly, of securities of the Company representing 40% or more of the combined voting power of the Company's then outstanding securities; (B) during any two-year period, individuals who at the beginning of such period constitute the Board (including, for this purpose, any director who after the beginning of such period filled a vacancy on the Board caused by the resignation, mandatory retirement, death, or disability of a director and whose election or appointment was approved by a vote of at least two-thirds of the directors then in office who were directors at the beginning of such period) cease for any reason to constitute a majority thereof; (C) notwithstanding clauses (A) or (E) of this paragraph, the Company consummates a merger or consolidation of the Company with or into another corporation, the result of which is that the Persons who were stockholders of the Company at the time of the execution of the agreement to merge or consolidate own less than 80% of the total equity of the corporation surviving or resulting from the merger or consolidation or of a corporation owning, directly or indirectly, 100% of the total equity of such surviving or resulting corporation; or (D) the sale in one or a series of transactions of all or substantially all of the assets of the Company; (E) any Person has commenced a tender or exchange offer, or entered into an agreement or received an option to acquire beneficial ownership of 40% or more of the total number of voting shares of the Company, unless the Board has made a determination that such action does not constitute and will not constitute a material change in the Persons having control of the Company; or (F) there is a change of control in the Company of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange Act other than in circumstances specifically covered by clauses (A) through (E) above. 2.7 "Code" means the Internal Revenue Code of 1986, as now in effect or as hereafter amended. 2.8 "Committee" means a committee of, and designated from time to time by resolution of, the Board, which shall consist of no fewer than two members of the Board, none of whom shall be an officer or other salaried employee of the Company or any affiliate of the Company. 2.9 "Company" means Answerthink, Inc. 2.10 "Effective Date" means April 23, 1998, the date on which the Plan was adopted by the Board. 2.11 "Exchange Act" means the Securities Exchange Act of 1934, as now in effect or as hereafter amended. 2.12 "Fair Market Value" means the value of a share of Stock, determined as follows: if on the Grant Date or other determination date the Stock is listed on an established national or regional stock exchange, is admitted to quotation on the NASDAQ National Market, or is publicly traded on an established securities market, the Fair Market Value of a share of Stock shall be the closing price of the Stock on such exchange or in such market (the highest such closing price if there is more than one such exchange or market) on the Grant Date or such other determination date (or if there is no such reported closing price, the Fair Market Value shall be the mean between the highest bid and lowest asked prices or between the high and low sale prices on such trading day) or, if no sale of Stock is reported for such trading day, on the next preceding day on which any sale shall have been reported. If the Stock is not listed on such an exchange, quoted on such system or traded on such a market, Fair Market Value shall be the value of the Stock as determined by the Board in good faith. 2.13 "Grant" means an award of an Option, Restricted Stock or Restricted Stock Units under the Plan. 2.14 "Grant Date" means, as determined by the Board or authorized Committee, (i) the date as of which the Board or such Committee approves a Grant, (ii) the date on which the recipient of such Grant first becomes eligible to receive a Grant under Section 6, hereof, or (iii) such other date as may be specified by the Board or such Committee. 2.15 "Grantee" means a person who receives or holds an Option, Restricted Stock or Restricted Stock Units under the Plan. 2.16 "Immediate Family Members" means the spouse, children and grandchildren of the Grantee. 2.17 "Incentive Stock Option" means an "incentive stock option" within the meaning of Section 422 of the Code, or the corresponding provision of any subsequently enacted tax statute, as amended from time to time. 2.18 "Option" means an option to purchase one or more shares of Stock pursuant to the Plan. 2.19 "Option Period" means the period during which Options may be exercised as set forth in Section 10 hereof. 2.20 "Option Price" means the purchase price for each share of Stock subject to an Option. 2.21 "Other Agreement" shall have the meaning set forth in Section 13 hereof. 2.22 "Outside Director" means a member of the Board who is not an officer or employee of the Company. 2.23 "Person" means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. 2.24 "Plan" means this Answerthink, Inc. 1998 Stock Option and Incentive Plan. 2.25 "Reporting Person" means a person who is required to file reports under Section 16(a) of the Exchange Act. 2.26 "Restricted Period" means the period during which Restricted Stock or Restricted Stock Units are subject to restrictions or conditions pursuant to Section 12.2 hereof. 2.27 "Restricted Stock" means shares of Stock, awarded to a Grantee pursuant to Section 12 hereof, that are subject to restrictions and to a risk of forfeiture. 2.28 "Restricted Stock Unit" means a unit awarded to a Grantee pursuant to Section 12 hereof, which represents a conditional right to receive a share of Stock in the future, and which is subject to restrictions and to a risk of forfeiture. 2.29 "Securities Act" means the Securities Act of 1933, as now in effect or as hereafter amended. 2.30 "Service Provider" means a consultant or adviser to the Company, a manager of the Company's properties or affairs, or other similar service provider or affiliate of the Company, and employees of any of the foregoing, as such persons may be designated from time to time by the Board pursuant to Section 6 hereof. 2.31 "Stock" means the common stock, par value $0.01 per share, of the Company. 2.32 "Subsidiary" means any "subsidiary corporation" of the Company within the meaning of Section 424(f) of the Code. 2.33 "Termination Date" shall be the date upon which an Option shall terminate or expire, as set forth in Section 10.2 hereof. 3. ADMINISTRATION OF THE PLAN 3.1 Board. The Board shall have such powers and authorities related to the administration of the Plan as are consistent with the Company's certificate of incorporation and by-laws and applicable law. The Board shall have full power and authority to take all actions and to make all determinations required or provided for under the Plan, any Grant or any Award Agreement, and shall have full power and authority to take all such other actions and make all such other determinations not inconsistent with the specific terms and provisions of the Plan that the Board deems to be necessary or appropriate to the administration of the Plan, any Grant or any Award Agreement. All such actions and determinations shall be by the affirmative vote of a majority of the members of the Board present at a meeting or by unanimous consent of the Board executed in writing in accordance with the Company's certificate of incorporation and by- laws and applicable law. The interpretation and construction by the Board of any provision of the Plan, any Grant or any Award Agreement shall be final and conclusive. As permitted by law, the Board may delegate its authority under the Plan to a member of the Board of Directors or an executive officer of the Company. 3.2 Committee. The Board from time to time may delegate to a Committee such powers and authorities related to the administration and implementation of the Plan, as set forth in Section 3.1 above and in other applicable provisions, as the Board shall determine, consistent with the certificate of incorporation and by-laws of the Company and applicable law. In the event that the Plan, any Grant or any Award Agreement entered into hereunder provides for any action to be taken by or determination to be made by the Board, such action may be taken by or such determination may be made by the Committee if the power and authority to do so has been delegated to the Committee by the Board as provided for in this Section. Unless otherwise expressly determined by the Board, any such action or determination by the Committee shall be final, binding and conclusive. As permitted by law, the Committee may delegate its authority under the Plan to a member of the Board of Directors or an executive officer of the Company. 3.3 Grants. Subject to the other terms and conditions of the Plan, the Board shall have full and final authority (i) to designate Grantees, (ii) to determine the type or types of Grant to be made to a Grantee, (iii) to determine the number of shares of Stock to be subject to a Grant, (iv) to establish the terms and conditions of each Grant (including, but not limited to, the exercise price of any Option, the nature and duration of any restriction or condition (or provision for lapse thereof) relating to the vesting, exercise, transfer, or forfeiture of a Grant or the shares of Stock subject thereto, and any terms or conditions that may be necessary to qualify Options as Incentive Stock Options), (v) to prescribe the form of each Award Agreement evidencing a Grant, and (vi) to amend, modify, or supplement the terms of any outstanding Grant. Such authority specifically includes the authority, in order to effectuate the purposes of the Plan but without amending the Plan, to modify Grants to eligible individuals who are foreign nationals or are individuals who are employed outside the United States to recognize differences in local law, tax policy, or custom. As a condition to any subsequent Grant, the Board shall have the right, at its discretion, to require Grantees to return to the Company Grants previously awarded under the Plan. Subject to the terms and conditions of the Plan, any such new Grant shall be upon such terms and conditions as are specified by the Board at the time the new Grant is made. 3.4 No Liability. No member of the Board or of the Committee shall be liable for any action or determination made in good faith with respect to the Plan or any Grant or Award Agreement. 3.5 Applicability of Rule 16b-3 Those provisions of the Plan that make express reference to Rule 16b-3 under the Exchange Act shall apply only to Reporting Persons. 4. STOCK SUBJECT TO THE PLAN Subject to adjustment as provided in Section 16 hereof, the number of shares of Stock available for issuance under the Plan shall be (i) 20,000,000, no more than 5,000,000 of which may be issued pursuant to awards of Restricted Stock or Restricted Stock Units and (ii) any shares of Stock that are represented by awards previously granted by the Company, including awards granted under the Answerthink, Inc. 1997 Stock Option Plan and the Answerthink, Inc. Restricted Stock Plan as of the Effective Date (the "Prior Plans"). Notwithstanding the foregoing, subject to Section 16 hereof, the maximum aggregate number of shares of Stock available for grants of Incentive Stock Options shall be 10,000,000. All stock options previously granted by the Company shall be deemed to be grants of Options pursuant to the Plan. Stock issued or to be issued under the Plan shall be authorized but unissued shares. If any shares covered by a Grant, including Grants made prior to the Effective Date, are not purchased or are forfeited, or if a Grant otherwise terminates without delivery of any Stock subject thereto, then the number of shares of Stock counted against the aggregate number of shares available under the Plan with respect to such Grant shall, to the extent of any such forfeiture or termination, again be available for making Grants under the Plan. 5. EFFECTIVE DATE AND TERM OF THE PLAN 5.1 Effective Date. The Plan shall be effective as of the Effective Date, subject to approval of the Plan within one year of the Effective Date, by a majority of the votes cast on the proposal at a meeting of shareholders, provided that the total votes cast represent a majority of all shares entitled to vote or by the written consent of the holders of a majority of the Company's shares entitled to vote. Upon approval of the Plan by the shareholders of the Company as set forth above, all Grants made under the Plan on or after the Effective Date shall be fully effective as if the shareholders of the Company had approved the Plan on the Effective Date. If the shareholders fail to approve the Plan within one year after the Effective Date, any Grants made hereunder shall be null and void and of no effect. 5.2 Term. The Plan has no termination date; however, no Incentive Stock Option may be granted under the Plan on or after the tenth anniversary of the Effective Date. 6. OPTION GRANTS 6.1 Company or Subsidiary Employees. Grants (including Grants of Incentive Stock Options) may be made under the Plan to any employee of, or Service Provider or employee of a Service Provider providing, or who has provided, services to, the Company or of any Subsidiary, including any such employee who is an officer or director of the Company or of any Subsidiary, as the Board shall determine and designate from time to time. 6.2 Successive Grants. An eligible person may receive more than one Grant, subject to such restrictions as are provided herein. 7. LIMITATIONS ON GRANTS 7.1 Limitation on Shares of Stock Subject to Grants. During any time when the Company has a class of equity security registered under Section 12 of the Exchange Act, no person eligible for a Grant under Section 6 hereof may be awarded Options in any calendar year exercisable for greater than 3,000,000 shares of Stock (subject to adjustment as provided in Section 16 hereof). During any time when the Company has a class of equity security registered under Section 12 of the Exchange Act, the maximum number of shares of Restricted Stock that can be awarded under the Plan (including for this purpose any shares of Stock represented by Restricted Stock Units) to any person eligible for a Grant under Section 6 hereof is 3,000,000 per calendar year (subject to adjustment as provided in Section 16 hereof). 7.2 Limitations on Incentive Stock Options. An Option shall constitute an Incentive Stock Option only (i) if the Grantee of such Option is an employee of the Company or any Subsidiary of the Company; (ii) to the extent specifically provided in the related Award Agreement; and (iii) to the extent that the aggregate Fair Market Value (determined at the time the Option is granted) of the shares of Stock with respect to which all Incentive Stock Options held by such Grantee become exercisable for the first time during any calendar year (under the Plan and all other plans of the Grantee's employer and its affiliates) does not exceed $100,000. This limitation shall be applied by taking Options into account in the order in which they were granted. 8. AWARD AGREEMENT Each Grant pursuant to the Plan shall be evidenced by an Award Agreement, in such form or forms as the Board shall from time to time determine. Award Agreements granted from time to time or at the same time need not contain similar provisions but shall be consistent with the terms of the Plan. Each Award Agreement evidencing a Grant of Options shall specify whether such Options are intended to be non-qualified stock options or Incentive Stock Options, and in the absence of such specification such options shall be deemed non-qualified stock options. 9. OPTION PRICE The Option Price of each Option shall be fixed by the Board and stated in the Award Agreement evidencing such Option. The Option Price shall be no lower than the Fair Market Value on the Grant Date of a share of Stock; provided, -------- however, that in the event that a Grantee would otherwise be ineligible to - ------- receive an Incentive Stock Option by reason of the provisions of Sections 422(b)(6) and 424(d) of the Code (relating to ownership of more than ten percent of the Company's outstanding Stock), the Option Price of an Option granted to such Grantee that is intended to be an Incentive Stock Option shall be not less than the greater of the par value or 110 percent of the Fair Market Value of a share of Stock on the Grant Date. In no case shall the Option Price of any Option be less than the par value of a share of Stock. Notwithstanding anything else to the contrary in this Section 9, the Board shall have the authority under the Plan to make a one time grant of non-qualified options with an Option Price less than the Fair Market Value of the Stock on the Grant Date to employees of the Company or its Subsidiaries who were participants in the Company's Employee Stock Purchase Plan ("ESPP") during the Offering Period ending December 31, 2000, and participants who enrolled in the ESPP for the Offering Period beginning January 1, 2001. The Board's authority to make option grants at an Option Price of less than the Fair Market Value of the Stock on the Grant Date shall be limited to this one time grant. 10. VESTING, TERM AND EXERCISE OF OPTIONS 10.1 Vesting and Option Period. Subject to Sections 10.2 and 16.3 hereof, each Option granted under the Plan shall become exercisable at such times and under such conditions as shall be determined by the Board and stated in the Award Agreement. For purposes of this Section 10.1, fractional numbers of shares of Stock subject to an Option shall be rounded down to the next nearest whole number. The period during which any Option shall be exercisable shall constitute the "Option Period" with respect to such Option. 10.2 Term. Each Option granted under the Plan shall terminate, and all rights to purchase shares of Stock thereunder shall cease, upon the expiration of ten years from the date such Option is granted, or under such circumstances and on such date prior thereto as is set forth in the Plan or as may be fixed by the Board and stated in the Award Agreement relating to such Option (the "Termination Date"); provided, however, that in the event that the Grantee would -------- ------- otherwise be ineligible to receive an Incentive Stock Option by reason of the provisions of Sections 422(b)(6) and 424(d) of the Code (relating to ownership of more than ten percent of the outstanding Stock), an Option granted to such Grantee that is intended to be an Incentive Stock Option shall not be exercisable after the expiration of five years from its Grant Date. 10.3 Acceleration. Any limitation on the exercise of an Option contained in any Award Agreement may be rescinded, modified or waived by the Board, in its sole discretion, at any time and from time to time after the Grant Date of such Option, so as to accelerate the time at which the Option may be exercised. Notwithstanding any other provision of the Plan, no Option shall be exercisable in whole or in part prior to the date the Plan is approved by the shareholders of the Company as provided in Section 5.1 hereof. 10.4 Termination of Employment or Other Relationship. Upon the termination of a Grantee's employment or other relationship with the Company other than by reason of death or "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code), any Option or portion thereof held by such Grantee that has not vested in accordance with the provisions of Section 10.1 hereof shall terminate immediately, and any Option or portion thereof that has vested in accordance with the provisions of Section 10.1 hereof but has not been exercised shall terminate at the close of business on the 90th day following the Grantee's termination of employment or other relationship(or, if such 90th day is a Saturday, Sunday or holiday, at the close of business on the next preceding day that is no a Saturday, Sunday or holiday), unless the Board, in its discretion, extends the period during which the Option may be exercised (which period may not be extended beyond the original term of the Option). Upon termination of an Option or portion thereof, the Grantee shall have no further right to purchase shares of Stock pursuant to such Option or portion thereof. Whether a leave of absence or leave on military or government service shall constitute a termination of employment or other relationship for purposes of the Plan shall be determined by the Board, which determination shall be final and conclusive. For purposes of the Plan, a termination of employment, service or other relationship shall not be deemed to occur if the Grantee is immediately thereafter employed with the Company or any other Service Provider, or is engaged as a Service Provider or an Outside director of the Company. Whether of termination of a Service Provider's or an Outside Director's relationship with the Company shall have occurred shall be determined by the Committee, which determination shall be final and conclusive. 10.5 Rights in the Event of Death. If a Grantee dies while employed by or providing services to the Company, all Options granted to such Grantee shall fully vest on the date of death, and the executors or administrators or legatees or distributees of such Grantee's estate shall have the right, at any time within one year after the date of such Grantee's death (or such longer period as the Board, in its discretion, may determine prior to the expiration of such one-year period) and prior to termination of the Option pursuant to Section 10.2 above, to exercise any Option held by such Grantee at the date of such Grantee's death. 10.6 Rights in the Event of Disability. If a Grantee's employment or other relationship with the Company is terminated by reason of the "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code) of such Grantee, such Grantee's Options shall continue to vest, and shall be exercisable to the extent that they are vested, for a period of one year after such termination of employment or service (or such longer period as the Board, in its discretion, may determine prior to the expiration of such one-year period), subject to earlier termination of the Option as provided in Section 10.2 above. Whether a termination of employment or service is to be considered by reason of "permanent and total disability" for purposes of the Plan shall be determined by the Board, which determination shall be final and conclusive. 10.7 Limitations on Exercise of Option. Notwithstanding any other provision of the Plan, in no event may any Option be exercised, in whole or in part, prior to the date the Plan is approved by the shareholders of the Company as provided herein, or after ten years following the date upon which the Option is granted, or after the occurrence of an event referred to in Section 16 hereof which results in termination of the Option. 10.8 Method of Exercise. An Option that is exercisable may be exercised by the Grantee's delivery to the Company of written notice of exercise on any business day, at the Company's principal office, addressed to the attention of the Board. Such notice shall specify the number of shares of Stock with respect to which the Option is being exercised and shall be accompanied by payment in full of the Option Price of the shares for which the Option is being exercised. The minimum number of shares of Stock with respect to which an Option may be exercised, in whole or in part, at any time shall be the lesser of (i) 100 shares or such lesser number set forth in the applicable Award Agreement and (ii) the maximum number of shares available for purchase under the Option at the time of exercise. Payment of the Option Price for the shares purchased pursuant to the exercise of an Option shall be made (i) in cash or in cash equivalents; (ii) through the tender to the Company of shares of Stock, which shares, if acquired from the Company, shall have been held for at least six months and which shall be valued, for purposes of determining the extent to which the Option Price has been paid thereby, at their Fair Market Value on the date of exercise; or (iii) by a combination of the methods described in (i) and (ii). The Board may provide, by inclusion of appropriate language in an Award Agreement, that payment in full of the Option Price need not accompany the written notice of exercise provided that the notice of exercise directs that the certificate or certificates for the shares of Stock for which the Option is exercised be delivered to a licensed broker acceptable to the Company as the agent for the individual exercising the Option and, at the time such certificate or certificates are delivered, the broker tenders to the Company cash (or cash equivalents acceptable to the Company) equal to the Option Price for the shares of Stock purchased pursuant to the exercise of the Option plus the amount (if any) of federal and/or other taxes which the Company may in its judgment, be required to withhold with respect to the exercise of the Option. An attempt to exercise any Option granted hereunder other than as set forth above shall be invalid and of no force and effect. Unless otherwise stated in the applicable Award Agreement, an individual holding or exercising an Option shall have none of the rights of a shareholder (for example, the right to receive cash or dividend payments or distributions attributable to the subject shares of Stock or to direct the voting of the subject shares of Stock) until the shares of Stock covered thereby are fully paid and issued to such individual. Except as provided in Section 16 hereof, no adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date of such issuance. 10.9 Delivery of Stock Certificates. Promptly after the exercise of an Option by a Grantee and the payment in full of the Option Price, such Grantee shall be entitled to the issuance of a stock certificate or certificates evidencing his or her ownership of the shares of Stock subject to the Option. 11. TRANSFERABILITY OF OPTIONS 11.1 General Rule Except as provided in Section 11.2, during the lifetime of a Grantee, only the Grantee (or, in the event of legal incapacity or incompetency, the Grantee's guardian or legal representative) may exercise an Option. Except as provided in Section 11.2, no Option shall be assignable or transferable by the Grantee to whom it is granted, other than by will or the laws of descent and distribution. 11.2 Family Transfers. If authorized in the applicable Award Agreement, a Grantee may transfer all or part of an Option that is not an Incentive Stock Option to (i) any Immediate Family Member, (ii) a trust or trusts for the exclusive benefit of any Immediate Family Member, or (iii) a partnership in which Immediate Family Members are the only partners, provided that (x) there may be no consideration for any such transfer, and (y) subsequent transfers of transferred Options are prohibited except those in accordance with this Section 11.2 or by will or the laws of descent and distribution. Following transfer, any such Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, provided that for purposes of Section 11.2 hereof the term "Grantee" shall be deemed to refer the transferee. The events of termination of the employment or other relationship of Section 10.4 hereof shall continue to be applied with respect to the original Grantee, following which the Option shall be exercisable by the transferee only to the extent, and for the periods specified in Sections 10.4, 10.5 or 10.6. 12. RESTRICTED STOCK 12.1 Grant of Restricted Stock or Restricted Stock Units. The Board may from time to time grant Restricted Stock or Restricted Stock Units to persons eligible to receive Grants under Section 6 hereof, subject to such restrictions, conditions and other terms as the Board may determine. 12.2 Restrictions. At the time a Grant of Restricted Stock or Restricted Stock Units is made, the Board shall establish a period of time (the "Restricted Period") applicable to such Restricted Stock or Restricted Stock Units. Each Grant of Restricted Stock or Restricted Stock Units may be subject to a different Restricted Period. The Board may, in its sole discretion, at the time a Grant of Restricted Stock or Restricted Stock Units is made, prescribe restrictions in addition to or other than the expiration of the Restricted Period, including the satisfaction of corporate or individual performance objectives, which may be applicable to all or any portion of the Restricted Stock or Restricted Stock Units. Such performance objectives shall be established in writing by the Board prior to the ninetieth day of the year in which the Grant is made and while the outcome is substantially uncertain. Performance objectives shall be based on Stock price, market share, sales, earnings per share, return on equity or costs. Performance objectives may include positive results, maintaining the status quo or limiting economic losses. Subject to the second sentence of this Section 12.2, the Board also may, in its sole discretion, shorten or terminate the Restricted Period or waive any other restrictions applicable to all or a portion of the Restricted Stock or Restricted Stock Units. Neither Restricted Stock nor Restricted Stock Units may be sold, transferred, assigned, pledged or otherwise encumbered or disposed of during the Restricted Period or prior to the satisfaction of any other restrictions prescribed by the Board with respect to such Restricted Stock or Restricted Stock Units. 12.3 Restricted Stock Certificates. The Company shall issue, in the name of each Grantee to whom Restricted Stock has been granted, stock certificates representing the total number of shares of Restricted Stock granted to the Grantee, as soon as reasonably practicable after the Grant Date. The Secretary of the Company shall hold such certificates for the Grantee's benefit until such time as the Restricted Stock is forfeited to the Company, or the restrictions lapse. 12.4 Rights of Holders of Restricted Stock. Unless the Board otherwise provides in an Award Agreement, holders of Restricted Stock shall have the right to vote such Stock and the right to receive any dividends declared or paid with respect to such Stock. The Board may provide that any dividends paid on Restricted Stock must be reinvested in shares of Stock, which may or may not be subject to the same vesting conditions and restrictions applicable to such Restricted Stock. All distributions, if any, received by a Grantee with respect to Restricted Stock as a result of any stock split, stock dividend, combination of shares, or other similar transaction shall be subject to the restrictions applicable to the original Grant. 12.5 Rights of Holders of Restricted Stock Units. Unless the Board otherwise provides in an Award Agreement, holders of Restricted Stock Units shall have no rights as stockholders of the Company. The Board may provide in an Award Agreement evidencing a Grant of Restricted Stock Units that the holder of such Restricted Stock Units shall be entitled to receive, upon the Company's payment of a cash dividend on its outstanding Stock, a cash payment for each Restricted Stock Unit held equal to the per-share dividend paid on the Stock. Such Award Agreement may also provide that such cash payment will be deemed reinvested in additional Restricted Stock Units at a price per unit equal to the Fair Market Value of a share of Stock on the date that such dividend is paid. 12.6 Termination of Employment or Other Relationship. Upon the termination of the employment of a Grantee with the Company or a Service Provider or of a Service Provider's relationship with the Company, in either case other than, in the case of individuals, by reason of death or "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code), any shares of Restricted Stock or Restricted Stock Units held by such Grantee that have not vested, or with respect to which all applicable restrictions and conditions have not lapsed, shall immediately be deemed forfeited, unless the Board, in its discretion, determines otherwise. Upon forfeiture of Restricted Stock or Restricted Stock Units, the Grantee shall have no further rights with respect to such Grant, including but not limited to any right to vote Restricted Stock or any right to receive dividends with respect to shares of Restricted Stock or Restricted Stock Units. Whether a leave of absence or leave on military or government service shall constitute a termination of employment or other relationship for purposes of the Plan shall be determined by the Board, which determination shall be final and conclusive. For purposes of the Plan, a termination of employment, service or other relationship shall not be deemed to occur if the Grantee is immediately thereafter employed with the Company or any other Service Provider, or is engaged as a Service Provider or an Outside Director of the Company. Whether a termination of a Service Provider's or an Outside Director's relationship with the Company shall have occurred shall be determined by the Committee, which determination shall be final and conclusive. 12.7 Rights in the Event of Death. If a Grantee dies while employed by the Company or a Service Provider, or while serving as a Service Provider, all Restricted Stock or Restricted Stock Units granted to such Grantee shall fully vest on the date of death, and the shares of Stock represented thereby shall be deliverable in accordance with the terms of the Plan to the executors, administrators, legatees or distributees of the Grantee's estate. 12.8 Rights in the Event of Disability. If a Grantee's employment or other relationship with the Company or a Service Provider, or while serving as a Service Provider, is terminated by reason of the "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code) of such Grantee, such Grantee's Restricted Stock or Restricted Stock Units shall continue to vest in accordance with the applicable Award Agreement for a period of one year after such termination of employment or service (or such longer period as the Board, in its discretion, may determine prior to the expiration of such one-year period), subject to the earlier forfeiture of such Restricted Stock or Restricted Stock Units in accordance with the terms of the applicable Award Agreement. Whether a termination of employment or service is to be considered by reason of "permanent and total disability" for purposes of the Plan shall be determined by the Board, which determination shall be final and conclusive. 12.9 Delivery of Stock and Payment Therefor. Upon the expiration or termination of the Restricted Period and the satisfaction of any other conditions prescribed by the Board, the restrictions applicable to shares of Restricted Stock or Restricted Stock Units shall lapse, and, upon payment by the Grantee to the Company, in cash or by check, of the aggregate par value of the shares of Stock represented by such Restricted Stock or Restricted Stock Units, a stock certificate for such shares shall be delivered, free of all such restrictions, to the Grantee or the Grantee's beneficiary or estate, as the case may be. 13. PARACHUTE LIMITATIONS Notwithstanding any other provision of this Plan or of any other agreement, contract, or understanding heretofore or hereafter entered into by a Grantee with the Company or any Subsidiary, except an agreement, contract, or understanding hereafter entered into that expressly modifies or excludes application of this paragraph (an "Other Agreement"), and notwithstanding any formal or informal plan or other arrangement for the direct or indirect provision of compensation to the Grantee (including groups or classes of participants or beneficiaries of which the Grantee is a member), whether or not such compensation is deferred, is in cash, or is in the form of a benefit to or for the Grantee (a "Benefit Arrangement"), if the Grantee is a "disqualified individual," as defined in Section 280G(c) of the Code, any Option, Restricted Stock or Restricted Stock Unit held by that Grantee and any right to receive any payment or other benefit under this Plan shall not become exercisable or vested (i) to the extent that such right to exercise, vesting, payment, or benefit, taking into account all other rights, payments, or benefits to or for the Grantee under this Plan, all Other Agreements, and all Benefit Arrangements, would cause any payment or benefit to the Grantee under this Plan to be considered a "parachute payment" within the meaning of Section 280G(b)(2) of the Code as then in effect (a "Parachute Payment") and (ii) if, as a result of --- receiving a Parachute Payment, the aggregate after-tax amounts received by the Grantee from the Company under this Plan, all Other Agreements, and all Benefit Arrangements would be less than the maximum after-tax amount that could be received by the Grantee without causing any such payment or benefit to be considered a Parachute Payment. In the event that the receipt of any such right to exercise, vesting, payment, or benefit under this Plan, in conjunction with all other rights, payments, or benefits to or for the Grantee under any Other Agreement or any Benefit Arrangement would cause the Grantee to be considered to have received a Parachute Payment under this Plan that would have the effect of decreasing the after-tax amount received by the Grantee as described in clause (ii) of the preceding sentence, then the Grantee shall have the right, in the Grantee's sole discretion, to designate those rights, payments, or benefits under this Plan, any Other Agreements, and any Benefit Arrangements that should be reduced or eliminated so as to avoid having the payment or benefit to the Grantee under this Plan be deemed to be a Parachute Payment. 14. REQUIREMENTS OF LAW 14.1 General. The Company shall not be required to sell or issue any shares of Stock under any Grant if the sale or issuance of such shares would constitute a violation by the Grantee, any other individual exercising an Option, or the Company of any provision of any law or regulation of any governmental authority, including without limitation any federal or state securities laws or regulations. If at any time the Company shall determine, in its discretion, that the listing, registration or qualification of any shares subject to a Grant upon any securities exchange or under any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the issuance or purchase of shares hereunder, no shares of Stock may be issued or sold to the Grantee or any other individual exercising an Option pursuant to such Grant unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company, and any delay caused thereby shall in no way affect the date of termination of the Grant. Specifically, in connection with the Securities Act, upon the exercise of any Option or the delivery of any shares of Restricted Stock or Stock underlying Restricted Stock Units, unless a registration statement under such Act is in effect with respect to the shares of Stock covered by such Grant, the Company shall not be required to sell or issue such shares unless the Board has received evidence satisfactory to it that the Grantee or any other individual exercising an Option may acquire such shares pursuant to an exemption from registration under the Securities Act. Any determination in this connection by the Board shall be final, binding, and conclusive. The Company may, but shall in no event be obligated to, register any securities covered hereby pursuant to the Securities Act. The Company shall not be obligated to take any affirmative action in order to cause the exercise of an Option or the issuance of shares of Stock pursuant to the Plan to comply with any law or regulation of any governmental authority. As to any jurisdiction that expressly imposes the requirement that an Option shall not be exercisable until the shares of Stock covered by such Option are registered or are exempt from registration, the exercise of such Option (under circumstances in which the laws of such jurisdiction apply) shall be deemed conditioned upon the effectiveness of such registration or the availability of such an exemption. 14.3 Rule 16b-3. During any time when the Company has a class of equity security registered under Section 12 of the Exchange Act, it is the intent of the Company that Grants pursuant to the Plan and the exercise of Options granted hereunder will qualify for the exemption provided by Rule 16b-3 under the Exchange Act. To the extent that any provision of the Plan or action by the Board does not comply with the requirements of Rule 16b-3, it shall be deemed inoperative to the extent permitted by law and deemed advisable by the Board, and shall not affect the validity of the Plan. In the event that Rule 16b-3 is revised or replaced, the Board may exercise its discretion to modify this Plan in any respect necessary to satisfy the requirements of, or to take advantage of any features of, the revised exemption or its replacement. 15. AMENDMENT AND TERMINATION OF THE PLAN The Board may, at any time and from time to time, amend, suspend, or terminate the Plan as to any shares of Stock as to which Grants have not been made; provided, however, that the Board shall not, without approval of the -------- ------- Company's shareholders, amend the Plan such that it does not comply with the Code. The Company may retain the right in an Award Agreement to cause a forfeiture of the gain realized by a Grantee on account of the Grantee taking actions in "competition with the Company," as defined in the applicable Award Agreement. Furthermore, the Company may annul a Grant if the Grantee is an employee of the Company or an affiliate and is terminated "for cause" as defined in the applicable Award Agreement. Except as permitted under this Section 15 or Section 16 hereof, no amendment, suspension, or termination of the Plan shall, without the consent of the Grantee, alter or impair rights or obligations under any Grant theretofore awarded under the Plan. 16. EFFECT OF CHANGES IN CAPITALIZATION 16.1 Changes in Stock. If the number of outstanding shares of Stock is increased or decreased or the shares of Stock are changed into or exchanged for a different number or kind of shares or other securities of the Company on account of any recapitalization, reclassification, stock split, reverse split, combination of shares, exchange of shares, stock dividend or other distribution payable in capital stock, or other increase or decrease in such shares effected without receipt of consideration by the Company occurring after the Effective Date, the number and kinds of shares for which Grants of Options, Restricted Stock and Restricted Stock Units may be made under the Plan shall be adjusted proportionately and accordingly by the Company. In addition, the number and kind of shares for which Grants are outstanding shall be adjusted proportionately and accordingly so that the proportionate interest of the Grantee immediately following such event shall, to the extent practicable, be the same as immediately before such event. Any such adjustment in outstanding Options shall not change the aggregate Option Price payable with respect to shares that are subject to the unexercised portion of an Option outstanding but shall include a corresponding proportionate adjustment in the Option Price per share. The conversion of any convertible securities of the Company shall not be treated as an increase in shares effected without receipt of consideration. 16.2 Reorganization in Which the Company Is the Surviving Entity and in Which No Change of Control Occurs. Subject to Section 16.3 hereof, if the Company shall be the surviving entity in any reorganization, merger, or consolidation of the Company with one or more other entities in which no Change in Control occurs, any Option theretofore granted pursuant to the Plan shall pertain to and apply to the securities to which a holder of the number of shares of Stock subject to such Option would have been entitled immediately following such reorganization, merger, or consolidation, with a corresponding proportionate adjustment of the Option Price per share so that the aggregate Option Price thereafter shall be the same as the aggregate Option Price of the shares remaining subject to the Option immediately prior to such reorganization, merger, or consolidation. Subject to any contrary language in an Award Agreement evidencing a Grant of Restricted Stock, any restrictions applicable to such Restricted Stock shall apply as well to any replacement shares received by the Grantee as a result of the reorganization, merger or consolidation. 16.3 Reorganization, Sale of Assets or Sale of Stock Which Involves a Change of Control Subject to the exceptions set forth in the last sentence of this Section 16.3, (i) upon the occurrence of a Change of Control, all outstanding shares of Restricted Stock and Restricted Stock Units shall be deemed to have vested, and all restrictions and conditions applicable to such shares of Restricted Stock and Restricted Stock Units shall be deemed to have lapsed, immediately prior to the occurrence of such Change of Control, and (ii) fifteen days prior to the scheduled consummation of the Change of Control, all Options outstanding hereunder shall become immediately exercisable and shall remain exercisable for a period of fifteen days. Any exercise of an Option during such fifteen-day period shall be conditioned upon the consummation of the event and shall be effective only immediately before the consummation of the event. Upon consummation of any Change of Control, the Plan and all outstanding but unexercised Options shall terminate. The Board shall send written notice of an event that will result in such a termination to all individuals who hold Options not later than the time at which the Company gives notice thereof to its shareholders. This Section 16.3 shall not apply to any Change of Control to the extent that (A) provision is made in writing in connection with such Change of Control for the continuation of the Plan or the assumption of the Options, Restricted Stock and Restricted Stock Units theretofore granted, or for the substitution for such Options, Restricted Stock and Restricted Stock Units of new options, restricted stock and restricted stock units covering the stock of a successor entity, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kinds of shares or units and exercise prices, in which event the Plan and Options, Restricted Stock and Restricted Stock Units theretofore granted shall continue in the manner and under the terms so provided or (B) a majority of the full Board determines that such Change of Control shall not trigger application of the provisions of this Section 16.3 subject to Section 24. 16.4 Adjustments. Adjustments under this Section 16 related to shares of Stock or securities of the Company shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. No fractional shares or other securities shall be issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall be eliminated in each case by rounding downward to the nearest whole share. 16.5 No Limitations on Company. The making of Grants pursuant to the Plan shall not affect or limit in any way the right or power of the Company to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure or to merge, consolidate, dissolve, or liquidate, or to sell or transfer all or any part of its business or assets. 17. DISCLAIMER OF RIGHTS No provision in the Plan or in any Grant or Award Agreement shall be construed to confer upon any individual the right to remain in the employ or service of the Company or any affiliate, or to interfere in any way with any contractual or other right or authority of the Company or a Service Provider either to increase or decrease the compensation or other payments to any individual at any time, or to terminate any employment or other relationship between any individual and the Company. In addition, notwithstanding anything contained in the Plan to the contrary, unless otherwise stated in the applicable Award Agreement, no Grant awarded under the Plan shall be affected by any change of duties or position of the Optionee, so long as such Grantee continues to be a director, officer, consultant or employee of the Company. The obligation of the Company to pay any benefits pursuant to this Plan shall be interpreted as a contractual obligation to pay only those amounts described herein, in the manner and under the conditions prescribed herein. The Plan shall in no way be interpreted to require the Company to transfer any amounts to a third party trustee or otherwise hold any amounts in trust or escrow for payment to any participant or beneficiary under the terms of the Plan. No Grantee shall have any of the rights of a shareholder with respect to the shares of Stock subject to an Option except to the extent the certificates for such shares of Stock shall have been issued upon the exercise of the Option. 18. NONEXCLUSIVITY OF THE PLAN Neither the adoption of the Plan nor the submission of the Plan to the shareholders of the Company for approval shall be construed as creating any limitations upon the right and authority of the Board to adopt such other incentive compensation arrangements (which arrangements may be applicable either generally to a class or classes of individuals or specifically to a particular individual or particular individuals) as the Board in its discretion determines desirable, including, without limitation, the granting of stock options otherwise than under the Plan. 19. WITHHOLDING TAXES The Company or a Subsidiary, as the case may be, shall have the right to deduct from payments of any kind otherwise due to a Grantee any Federal, state, or local taxes of any kind required by law to be withheld with respect to the vesting of or other lapse of restrictions applicable to Restricted Stock or Restricted Stock Units or upon the issuance of any shares of Stock upon the exercise of an Option. At the time of such vesting, lapse, or exercise, the Grantee shall pay to the Company or the Subsidiary, as the case may be, any amount that the Company or the Subsidiary may reasonably determine to be necessary to satisfy such withholding obligation. Subject to the prior approval of the Company or the Subsidiary, which may be withheld by the Company or the Subsidiary, as the case may be, in its sole discretion, the Grantee may elect to satisfy such obligations, in whole or in part, (i) by causing the Company or the Subsidiary to withhold shares of Stock otherwise issuable to the Grantee or (ii) by delivering to the Company or the Subsidiary shares of Stock already owned by the Grantee. The shares of Stock so delivered or withheld shall have an aggregate Fair Market Value equal to such withholding obligations. The Fair Market Value of the shares of Stock used to satisfy such withholding obligation shall be determined by the Company or the Subsidiary as of the date that the amount of tax to be withheld is to be determined. A Grantee who has made an election pursuant to this Section 19 may satisfy his or her withholding obligation only with shares of Stock that are not subject to any repurchase, forfeiture, unfulfilled vesting, or other similar requirements. 20. CAPTIONS The use of captions in this Plan or any Award Agreement is for the convenience of reference only and shall not affect the meaning of any provision of the Plan or such Award Agreement. 21. OTHER PROVISIONS Each Grant awarded under the Plan may contain such other terms and conditions not inconsistent with the Plan as may be determined by the Board, in its sole discretion. 22. NUMBER AND GENDER With respect to words used in this Plan, the singular form shall include the plural form, the masculine gender shall include the feminine gender, etc., as the context requires. 23. SEVERABILITY If any provision of the Plan or any Award Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction. 24. POOLING Notwithstanding anything in the Plan to the contrary, if any right under or feature of the Plan would cause to be ineligible for pooling of interest accounting a transaction that would, but for the right or feature hereunder, be eligible for such accounting treatment, the Board may modify or adjust the right or feature so that the transaction will be eligible for pooling of interest accounting. Such modification or adjustment may include payment of cash or issuance to a Grantee of Stock having a Fair Market Value equal to the cash value of such right or feature. 25. GOVERNING LAW The validity and construction of this Plan and the instruments evidencing the Grants awarded hereunder shall be governed by the laws of the State of Florida. EX-99.D.2 8 dex99d2.txt EXHIBIT (D)(2) Exhibit (d)(2) -------------- FORM OF EMPLOYEE STOCK OPTION AGREEMENT ANSWERTHINK, INC. 1998 STOCK OPTION AND INCENTIVE PLAN This Stock Option Agreement is made as of [______ ___], 2002, by and between Answerthink, Inc., a Florida corporation (the "Company"), and [__________], an individual who is employed by, or providing services to, the Company or one of its affiliates or Service Providers (the "Optionee"). WHEREAS, the Board of Directors and stockholders of the Company have duly adopted and approved the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Plan"), which Plan authorizes the Company to grant to eligible individuals options for the purchase of shares of the Company's common stock, par value $.001 per share (the "Stock"); and WHEREAS, the Company has determined that it is desirable and in its best interests to grant to the Optionee, pursuant to the Plan, an option to purchase a certain number of shares of Stock, in order to provide the Optionee with an incentive to advance the interests of the Company and any affiliate thereof; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties hereto do hereby agree as follows: 1. GRANT OF OPTION Subject to the terms of the Plan (attached hereto as Exhibit A), the --------- Company hereby grants to the Optionee the right and option (the "Option") to purchase from the Company, on the terms and subject to the conditions set forth in the Plan and in this Option Agreement, [_______] shares of Stock. This Option shall not constitute an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). The Grant Date of this Option is [_________ __], 2002. 2. TERMS OF PLAN The Option granted pursuant to this Stock Option Agreement is granted subject to the terms and conditions set forth in the Plan. All terms and conditions of the Plan are hereby incorporated into this Stock Option Agreement by reference and shall be deemed to be part of this Stock Option Agreement, without regard to whether such terms and conditions are not otherwise set forth in this Stock Option Agreement. To the extent any capitalized words used in this Stock Option Agreement are not defined, they shall have the definitions stated for them in the Plan. In the event that there is any inconsistency between the provisions of this Stock Option Agreement and of the Plan, the provisions of the Plan shall govern. 3. OPTION PRICE The purchase price (the "Option Price") for each share subject to the Option granted by this Stock Option Agreement is $[____]. 4. VESTING IN OPTIONS The Option will vest as follows: [vesting schedule of option tendered for exchange and replaced by the Option]. 5. TERM AND EXERCISE OF OPTION 5.1 Term The Option shall terminate and all rights to purchase the shares thereunder shall cease upon the expiration of ten years after [grant date of option tendered for exchange and replaced by the Option], unless terminated earlier pursuant to another provision of this Stock Option Agreement. 5.2 Option Period and Limitations on Exercise The Optionee may exercise the Option (subject to the limitations on exercise set forth in this Stock Option Agreement and in the Plan), to the extent the Option is vested and has not terminated. Any limitation on the exercise of an Option may be rescinded, modified or waived by the Committee, in its sole discretion, at any time and from time to time after the Grant Date of the Option, so as to accelerate the time at which the Option may be exercised. The time at which the Option may be exercised will be accelerated and the Option shall be exercisable, in whole or in part, at any time and from time to time prior to termination of the Option after termination of employment by reason of death of Optionee or "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code) of the Optionee. 5.3 Limitations on Exercise of Option Notwithstanding the foregoing Sections, in no event may the Option be exercised: (i) in whole or in part, after ten years following [grant date of option tendered for exchange and replaced by the Option], (ii) following termination of employment or other relationship for Cause (as defined below) or (iii) following termination of employment or other relationship except as provided in Sections 7.1, 7.2, and 7.3 below. For purposes of this Stock Option Agreement, "Cause" means (i) the commission of a felony or a crime involving moral turpitude or the commission of any other act or omission involving dishonesty or fraud with respect to the Company or any of its affiliates or any of their customers or suppliers, (ii) conduct tending to bring the Company or any of its affiliates into substantial public disgrace or disrepute, (iii) substantial and repeated failure to perform duties of the office held by the Optionee as reasonably directed by the Board, and such failure is not cured within 30 days after the Executive receives notice thereof from the Board, (iv) gross negligence or willful misconduct with respect to the Company or any of its affiliates or (v) material breach of any term of any employment, consulting or other services, confidentiality, intellectual property or non-competition agreements, if any, between Optionee and the Company or any of its affiliates. 5.4 Method of Exercise The Option may be exercised, to the extent it is exercisable, by the Optionee's delivery to the Company of written notice of exercise on any business day, at the Company's principal office, addressed to the attention of the Committee. Such notice shall specify the number of shares of Stock with respect to which the Option is being exercised and shall be accompanied by payment in full of the Option Price of the shares for which the Option is being exercised. The minimum number of shares of Stock with respect to which an Option may be exercised, in whole or in part, at any time shall be the lesser of (i) 100 shares and (ii) the maximum number of shares available for purchase under the Option at the time of exercise. Payment of the Option Price for the shares purchased pursuant to the exercise of the Option shall be made (i) in cash or in cash equivalents; (ii) through the tender to the Company of shares of Stock, which shares, if acquired from the Company, shall have been held by the Optionee for at least six months and which shall be valued, for purposes of determining the extent to which the Option Price has been paid thereby, at their Fair Market Value on the date of exercise; or (iii) by a combination of the methods described in (i) and (ii). If the Stock is publicly traded, payment in full of the Option Price need not accompany the written notice of exercise provided that the notice of exercise directs that the certificate or certificates for the shares of Stock for which the Option is exercised be delivered to a licensed broker acceptable to the Company as the agent for the individual exercising the Option and, at the time such certificate or certificates are delivered, the broker tenders to the Company cash (or cash equivalents acceptable to the Company) equal to the Option Price for the shares of Stock purchased pursuant to the exercise of the Option plus the amount (if any) of federal and/or other taxes which the Company may in its judgment, be required to withhold with respect to the exercise of the Option. An attempt to exercise the Option other than as set forth above shall be invalid and of no force and effect. An individual holding or exercising an Option shall have none of the rights of a shareholder (for example, the right to receive cash or dividend payments or distributions attributable to the subject shares of Stock or to direct the voting of the subject shares of Stock) until the shares of Stock covered thereby are fully paid and issued to him. Except as provided in Section 10 hereof, no adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date of such issuance. 6. PARACHUTE LIMITATIONS Notwithstanding any other provision of this Stock Option Agreement or of any other agreement, contract, or understanding heretofore or hereafter entered into by the Optionee and the Company or any Subsidiary, except an agreement, contract, or understanding hereafter entered into that expressly modifies or excludes application of this Section (the "Other Agreements"), and notwithstanding any formal or informal plan or other arrangement heretofore or hereafter adopted by the Company (or any Subsidiary) for the direct or indirect compensation of the Optionee (including groups or classes of participants or beneficiaries of which the Optionee is a member), whether or not such compensation is deferred, is in cash, or is in the form of a benefit to or for the Optionee (a "Benefit Arrangement"), if the Optionee is a "disqualified individual," as defined in Section 280G(c) of the Code, the Option and any right to receive any payment or other benefit under this Stock Option Agreement shall not become exercisable or vested (i) to the extent that such right to exercise, vesting, payment, or benefit, taking into account all other rights, payments, or benefits to or for Optionee under the Plan, all Other Agreements, and all Benefit Arrangements, would cause any payment or benefit to the Optionee under this Stock Option Agreement to be considered a "parachute payment" within the meaning of Section 280G(b)(2) of the Code as then in effect (a "Parachute Payment") and (ii) if, as a result of receiving a Parachute Payment, the --- aggregate after-tax amounts received by the Optionee from the Company under this Stock Option Agreement, the Plan, all Other Agreements, and all Benefit Arrangements would be less than the maximum after-tax amount that could be received by Optionee without causing any such payment or benefit to be considered a Parachute Payment. In the event that the receipt of any such right to exercise, vesting, payment, or benefit under this Stock Option Agreement, in conjunction with all other rights, payments, or benefits to or for the Optionee under the Plan, any Other Agreement or any Benefit Arrangement would cause the Optionee to be considered to have received a Parachute Payment under this Stock Option Agreement that would have the effect of decreasing the after-tax amount received by the Optionee as described in clause (ii) of the preceding sentence, then the Optionee shall have the right, in the Optionee's sole discretion, to designate those rights, payments, or benefits under this Stock Option Agreement, the Plan, any Other Agreements, and any Benefit Arrangements that should be reduced or eliminated so as to avoid having the payment or benefit to the Optionee under this Stock Option Agreement be deemed to be a Parachute Payment. 7. TERMINATION OF THE SERVICE RELATIONSHIP 7.1 Termination of Employment or Other Relationship Upon the termination of the Optionee's employment or other relationship with the Company or any of its affiliates or Service Providers other than by reason of death or "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code), the Option or portion thereof held by the Optionee that has not vested in accordance with the provisions of Section 4 hereof shall terminate immediately, and any Option or portion thereof that has vested in accordance with the provisions of Section 4 hereof but has not been exercised shall terminate at the close of business on the 90th day following the Optionee's termination of employment or other relationship (or, if such 90th day is a Saturday, Sunday or holiday, at the close of business on the next preceding day that is not a Saturday, Sunday or holiday), unless the Board of Directors (the "Board"), in its discretion, extends the period during which the Option may be exercised (which period may not be extended beyond the original term of the Option). Upon termination of the Option or portion thereof, the Optionee shall have no further right to purchase shares of Stock pursuant to such Option or portion thereof. Whether a leave of absence or leave on military or government service shall constitute a termination of employment or other relationship for purposes of the Optionee shall be determined by the Board, which determination shall be final and conclusive. For purposes of the Option, a termination of employment, service or other relationship shall not be deemed to occur if the Optionee is immediately thereafter employed with the Company or any of its affiliates or Service Providers, or is engaged as a Service Provider or an Outside Director of the Company. Whether a termination of a Service Provider's or an Outside Director's relationship with the Company shall have occurred shall be determined by the Committee, which determination shall be final and conclusive. 7.2 Rights in the Event of Death If the Optionee dies while employed by, or in the service of, the Company or any of its affiliates or Service Providers, the executors or administrators or legatees or distributees of such Optionee's estate shall have the right at any time within one year after the date of such Optionee's death, and prior to termination of the Option pursuant to Section 5.1 above, to exercise, in whole or in part, any Option held by such Optionee at the date of such Optionee's death, whether or not such Option was exercisable immediately prior to such Optionee's death. 7.3 Rights in the Event of Disability If the Optionee's employment or other relationship with the Company or any of its affiliates is terminated by reason of the "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code) of the Optionee, then such Optionee shall have the right, at any time within one year after such termination of employment or other relationship and prior to termination of the Option pursuant to Section 5.1 above, to exercise, in whole or in part, the Option held by such Optionee at the date of such termination of employment or other relationship, whether or not such Option was exercisable immediately prior to such termination of employment or other relationship. Whether a termination of employment or other relationship is to be considered by reason of "permanent and total disability" for purposes of this Stock Option Agreement shall be determined by the Committee, which determination shall be final and conclusive. 8. TRANSFERABILITY 8.1 General Rule Except as provided in Section 8.2, during the lifetime of a Optionee, only the Optionee (or, in the event of legal incapacity or incompetency, the Optionee's guardian or legal representative) may exercise the Option. Except as provided in Section 8.2, the Option shall not be assignable or transferable by the Optionee, other than by will or the laws of descent and distribution. 8.2 Family Transfers. An Optionee may transfer all or part of the Option to (i) any Immediate Family Member, (ii) a trust or trusts for the exclusive benefit of any Immediate Family Member, or (iii) a partnership in which Immediate Family Members are the only partners, provided that (x) there may be no consideration for any such transfer, and (y) subsequent transfers of the transferred Option are prohibited except those in accordance with this Section 8.2 or by will or the laws of descent and distribution. Following transfer, the Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, provided that for purposes of Section 8.2 hereof the term "Optionee" shall be deemed to refer to the transferee. The events of termination of the employment or other relationship of Section 7.1 hereof shall continue to be applied with respect to the original Optionee, following which the Option shall be exercisable by the transferee only to the extent and for the periods specified in Sections 7.1, 7.2 or 7.3. "Immediate Family Members" means the spouse, children and grandchildren of the Optionee. 8.3 Nontransferability of Shares Except as provided in Section 8.2, Optionee (or such other individual who is entitled to exercise an Option) shall not sell, pledge, assign, gift, transfer, or otherwise dispose of any shares of Stock acquired pursuant to an Option to any person or entity without first offering such shares to the Company for purchase on the same terms and conditions as those offered the proposed transferee. The Company may assign its right of first refusal under this Section 8.3 in whole or in part, to (1) any holder of stock or other securities of the Company (a "Stockholder"), (2) any affiliate or (3) any other person or entity that the Board of Directors of the Company determines has a sufficient relationship with or interest in the Company. The Company shall give reasonable written notice to the Optionee of any such assignment of its rights. The restrictions of this Section 8.3 re-apply to any person to whom Stock that was originally acquired pursuant to an Option is sold, pledged, assigned, bequeathed, gifted, transferred or otherwise disposed of, without regard to the number of such subsequent transferees or the manner in which they acquire the Stock, but the restrictions of this Section 8.3 do not apply to a transfer of Stock that occurs as a result of the death of the Optionee or of any subsequent transferee (but shall apply to the executor, the administrator or personal representative, the estate, and the legatees, beneficiaries and assigns thereof). 8.4 Repurchase Rights. Upon the termination of Optionee's employment or other relationship with the Company or any of its affiliates or Service Providers (whether as an employee, a director, an independent contractor providing services to the Company or any of its affiliates or Service Providers, or otherwise), the Company shall have the right, for a period of up to twelve months following such termination, to repurchase any or all of the shares acquired by the individual pursuant to this Option (including shares that were previously transferred pursuant to Section 8.3 above), at a price equal to the fair market value of such shares on the date of termination. Upon the exercise of an Option following termination of Optionee's employment or other relationship with the Company or any of its affiliates or Service Providers (whether as an employee, a director, an independent contractor providing services to the Company or any of its affiliates or Service Providers, or otherwise), the Company shall have the right, for a period of up to twelve months following such exercise, to repurchase any or all such shares of Stock acquired by the Optionee pursuant to such exercise of such Option at a price that is equal to the fair market value of such shares (including shares that were previously transferred pursuant to Section 8.3 above) on the date of exercise . In the event that the Company determines that it cannot or will not exercise its rights to purchase Stock under this Section 8.4 in whole or in part, the Company may assign its rights, in whole or in part, to (1) any Stockholder (2) any affiliate or (3) any other person or entity that the Board of Directors of the Company determines has a sufficient relationship with or interest in the Company. The Company shall give reasonable written notice to the individual of any assignment of its rights. 8.5 Publicly Traded Stock If the Stock is listed on an established national or regional stock exchange or is admitted to quotation on the National Association of Securities Dealers Automated Quotation System, or is publicly traded in an established securities market, the foregoing transfer restrictions of Sections 8.3 and 8.4 shall terminate as of the first date that the Stock is so listed, quoted or publicly traded. 8.6 Legend In order to enforce the restrictions imposed upon shares of Stock under the Plan and this Agreement, the Board may cause a legend or legends to be placed on any certificate representing shares issued pursuant to the Plan that complies with the applicable securities laws and regulations and makes appropriate reference to the restrictions imposed under it. 9. REQUIREMENTS OF LAW The Company shall not be required to sell or issue any securities under the Option if the sale or issuance of such securities would constitute a violation by the Optionee, the individual exercising the Option, or the Company of any provisions of any law or regulation of any governmental authority, including without limitation any federal or state securities laws or regulations. If at any time the Company shall determine, in its discretion, that the listing, registration or qualification of any securities subject to the Option upon any securities exchange or under any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the issuance or purchase of securities hereunder, the Option may not be exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company, and any delay caused thereby shall in no way affect the date of termination of the Option. Specifically in connection with the 1933 Act, upon the exercise of the Option, unless a registration statement under such act is in effect with respect to the securities covered by the Option, the Company shall not be required to sell or issue such securities unless the Committee has received evidence satisfactory to it that the holder of such Option may acquire such securities pursuant to an exemption from registration under such act. Any determination in this connection by the Committee shall be final, binding, and conclusive. The Company may, but shall in no event be obligated to, register any securities covered hereby pursuant to the 1933 Act. The Company shall not be obligated to take any affirmative action in order to cause the exercise of the Option or the issuance of securities pursuant thereto to comply with any law or regulation of any governmental authority. As to any jurisdiction that expressly imposes the requirement that the Option shall not be exercisable until the securities covered by such Option are registered or are exempt from registration, the exercise of such Option (under circumstances in which the laws of such jurisdiction apply) shall be deemed conditioned upon the effectiveness of such registration or the availability of such an exemption. 10. EFFECT OF CHANGES IN CAPITALIZATION 10.1 Changes in Stock If the number of outstanding shares of Stock is increased or decreased or the shares of Stock are changed into or exchanged for a different number or kind of shares or other securities of the Company on account of any recapitalization, reclassification, stock split, reverse split, combination of shares, exchange of shares, stock dividend or other distribution payable in capital stock, or other increase or decrease in such shares effected without receipt of consideration by the Company, occurring after the date of grant of the Option, the number and kind of shares of Stock for which the Option was granted shall be adjusted proportionately and accordingly so that the proportionate interest of the Optionee immediately following such event shall, to the extent practicable, be the same as immediately before such event. Any such adjustment in the Option shall not change the aggregate Option Price payable with respect to shares that are subject to the unexercised portion of the Option but shall include a corresponding proportionate adjustment in the Option Price per share. 10.2 Dissolution, Liquidation, Sale of Assets, Reorganization in Which the Company Is Not the Surviving Entity, Etc. Subject to Section 10.3 hereof, if the Company shall be the surviving entity in any reorganization, merger, or consolidation of the Company with one or more other entities and in which no Change in Control occurs, the Option shall pertain to and apply to the securities to which the Optionee would have been entitled immediately following such reorganization, merger, or consolidation, with a corresponding proportionate adjustment of the Option Price per share so that the aggregate Option Price thereafter shall be the same as the aggregate Option Price of the shares remaining subject to the Option immediately prior to such reorganization, merger, or consolidation. 10.3 Reorganization, Sale of Assets or Sale of Stock Which Involves a Change of Control. Subject to the exceptions set forth in the last sentence of this Section 10.3 (i) upon the occurrence of a Change of Control, fifteen days prior to the scheduled consummation of a Change of Control, the Option shall become immediately exercisable to the extent not previously exercisable and shall remain exercisable for a period of fifteen days. Any exercise of an Option during such fifteen-day period shall be conditioned upon the consummation of the event and shall be effective only immediately before the consummation of the event. Upon consummation of any Change of Control, the Options, to the extent not exercised shall terminate. The Board shall send written notice of an event that will result in such a termination to the Optionee not later than the time at which the Company gives notice thereof to its shareholders. This Section 10.3 shall not apply to any Change of Control to the extent that (A) provision is made in writing in connection with such Change of Control for the assumption of the Option, for the substitution for such Option, of new options covering the stock of a successor entity, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kinds of shares and exercise prices, in which event the Option shall continue in the manner and under the terms so provided or (B) a majority of the full Board determines that such Change of Control shall not trigger application of the provisions of this Section 10.3. 10.4 Adjustments Adjustments under this Section 10 related to stock or securities of the Company shall be made by the Board, whose determination in that respect shall be final, binding, and conclusive. No fractional shares of Stock or units of other securities shall be issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall be eliminated in each case by rounding downward to the nearest whole share or unit. 10.5 No Limitations on Company The grant of the Option shall not affect or limit in any way the right or power of the Company to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure or to merge, consolidate, dissolve, or liquidate, or to sell or transfer all or any part of its business or assets. 11. DISCLAIMER OF RIGHTS No provision in the Plan or in the Stock Option Agreement shall be construed to confer upon any individual the right to remain in the employ or service of the Company or any of its affiliates or Service Providers, or to interfere in any way with any contractual or other right or authority of the Company or any of its affiliates or Service Providers either to increase or decrease the compensation or other payments to any individual at any time, or to terminate any employment or other relationship between any individual and the Company or any of its affiliates or Service Providers. In addition, notwithstanding anything contained in the Plan to the contrary, the Option shall not be affected by any change of duties or position of the Optionee, so long as the Optionee continues to be a director, officer, consultant or employee of the Company or any of its affiliates or Service Providers. The obligation of the Company to pay any benefits pursuant to this Stock Option Agreement shall be interpreted as a contractual obligation to pay only those amounts described herein, in the manner and under the conditions prescribed herein. The Plan and the Stock Option Agreement shall in no way be interpreted to require the Company to transfer any amounts to a third party trustee or otherwise hold any amounts in trust or escrow for payment to any participant or beneficiary under the terms of the Plan. The Optionee shall not have any of the rights of a shareholder with respect to the shares of Stock subject to an Option except to the extent the certificates for such shares of Stock shall have been issued upon the exercise of the Option. 12. FORFEITURE OF RIGHTS The Company at any time shall have the right to cause a forfeiture of the rights of the Optionee on account of the Optionee taking actions in competition with the Company. Unless otherwise specified in an employment or other agreement between the Company and the Optionee, the Optionee takes actions in competition with the Company if he or she directly or indirectly owns any interest in, operates, joins, controls or participates as a partner, director, principal, officer, or agent of, enters into the employment of, acts as a consultant to, or performs any services for, any entity which has material operations which compete with any business in which the Company or any of its Subsidiaries is engaged during the Optionee's employment or other relationship with the Company or any of its affiliates or Service Providers or at the time of the Optionee's termination of employment or other relationship. 13. CAPTIONS The use of captions in this Stock Option Agreement is for the convenience of reference only and shall not affect the meaning of any provision of such Stock Option Agreement. 14. WITHHOLDING OF TAXES The Company or a Subsidiary, as the case may be, shall have the right to deduct from payments of any kind otherwise due to the Optionee any Federal, state, or local taxes of any kind required by law to be withheld upon the issuance of any shares of Stock upon the exercise of the Option. At the time of such exercise, the Optionee shall pay to the Company or the Subsidiary, as the case may be, any amount that the Company or the Subsidiary may reasonably determine to be necessary to satisfy such withholding obligation. Subject to the prior approval of the Company or the Subsidiary, which may be withheld by the Company or the Subsidiary, as the case may be, in its sole discretion, the Optionee may elect to satisfy such obligations, in whole or in part, (i) by causing the Company or the Subsidiary to withhold shares of Stock otherwise issuable to the Optionee or (ii) by delivering to the Company or the Subsidiary shares of Stock already owned by the Optionee. The shares of Stock so delivered or withheld shall have an aggregate Fair Market Value equal to such withholding obligations. The Fair Market Value of the shares of Stock used to satisfy such withholding obligation shall be determined by the Company or the Subsidiary as of the date that the amount of tax to be withheld is to be determined. The Optionee who has made an election pursuant to this Section 14 may satisfy his or her withholding obligation only with shares of Stock that are not subject to any repurchase, forfeiture, unfulfilled vesting, or other similar requirements. 15. SEVERABILITY If any provision of the Plan or this Stock Option Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions thereof and hereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction. 16. INTERPRETATION OF THIS STOCK OPTION AGREEMENT All decisions and interpretations made by the Company or the Committee with regard to any question arising under the Plan or this Stock Option Agreement shall be final, binding and conclusive on the Company and the Optionee and any other person entitled to exercise the Option as provided for herein. 17. GOVERNING LAW The validity and construction of this Stock Option Agreement shall be governed by the laws of the State of Delaware but not including the choice of law rules thereof. 18. BINDING EFFECT Subject to all restrictions provided for in this Stock Option Agreement, the Plan and by applicable law limiting assignment and transfer of this Stock Option Agreement and the Option provided for herein, this Stock Option Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and assigns. 19. NOTICE All notices or other communications which may be or are required to be given by any party to any other party pursuant to this Stock Option Agreement shall be in writing and shall be mailed by first-class, registered or certified mail, return receipt requested, postage prepaid, or transmitted by hand delivery or telecopier (fax), addressed as follows: If to the Company: Answerthink, Inc. 1001 Brickell Bay Drive, Suite 3000 Miami, Florida 33131 Attention: Jack Brennan Telecopy: 305/379-8810 If to Optionee: At the address set forth below under Optionee's name at the foot of this Agreement. Each party may designate by notice in writing a new address to which any notice or other communication may thereafter be so given. Each notice or other communication which shall be mailed, delivered or transmitted in the manner described above, shall be deemed sufficiently given for all purposes at such time as it is delivered to the addressee with the return receipt, the delivery receipt, the affidavit of personal courier or, with respect to a telecopy, upon acknowledgment of receipt thereof and in all cases at such time as delivery is refused by the addressee upon presentation. 20. ENTIRE AGREEMENT This Stock Option Agreement and the Plan together constitute the entire agreement between the parties hereto with respect to the subject matter hereof. Neither this Stock Option Agreement nor any term hereof may be amended, waived, discharged or terminated except by a written instrument signed by the Company and the Optionee; provided, however, that the Company unilaterally may -------- ------- waive any provision hereof in writing to the extent that such waiver does not adversely affect the interests of the Optionee hereunder, but no such waiver shall operate as or be construed to be a subsequent waiver of the same provision or a waiver of any other provision hereof. IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Stock Option Agreement, or caused this Stock Option Agreement to be duly executed and delivered in their name and on their behalf, as of the day and year first above written. ANSWERTHINK, INC. By:________________________ OPTIONEE: ___________________________ [Name of Optionee] ADDRESS FOR NOTICE TO OPTIONEE: ___________________________ ___________________________ ___________________________ [Address of Optionee] Exhibit A: Answerthink, Inc. 1998 Stock Option and Incentive Plan - --------- EX-99.D.3 9 dex99d3.txt EXHIBIT (D)(3) Exhibit (d)(3) -------------- FORM OF DIRECTOR STOCK OPTION AGREEMENT ANSWERTHINK, INC. 1998 STOCK OPTION AND INCENTIVE PLAN This Stock Option Agreement is made as of [_______ __], 2002, by and between Answerthink, Inc., a Florida corporation (the "Company"), and _________, an individual who is an Outside Director providing services to the Company (the "Optionee"). WHEREAS, the Board of Directors and stockholders of the Company have duly adopted and approved the Answerthink, Inc. 1998 Stock Option and Incentive Plan (the "Plan"), which Plan authorizes the Company to grant to eligible individuals options for the purchase of shares of the Company's common stock, par value $.001 per share (the "Stock"); and WHEREAS, the Company has determined that it is desirable and in its best interests to grant to the Optionee, pursuant to the Plan, an option to purchase a certain number of shares of Stock, in order to provide the Optionee with an incentive to advance the interests of the Company and any affiliate thereof; NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties hereto do hereby agree as follows: 1. GRANT OF OPTION Subject to the terms of the Plan (attached hereto as Exhibit A), the --------- Company hereby grants to the Optionee the right and option (the "Option") to purchase from the Company, on the terms and subject to the conditions set forth in the Plan and in this Option Agreement, [_______] shares of Stock. This Option shall not constitute an incentive stock option within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). The Grant Date of this Option is [__________ ___], 2002. 2. TERMS OF PLAN The Option granted pursuant to this Stock Option Agreement is granted subject to the terms and conditions set forth in the Plan. All terms and conditions of the Plan are hereby incorporated into this Stock Option Agreement by reference and shall be deemed to be part of this Stock Option Agreement, without regard to whether such terms and conditions are not otherwise set forth in this Stock Option Agreement. To the extent any capitalized words used in this Stock Option Agreement are not defined, they shall have the definitions stated for them in the Plan. In the event that there is any inconsistency between the provisions of this Stock Option Agreement and of the Plan, the provisions of the Plan shall govern. 3. OPTION PRICE The purchase price (the "Option Price") for each share subject to the Option granted by this Stock Option Agreement is $[_____]. 4. VESTING IN OPTIONS The Option will vest as follows: [vesting schedule of option tendered for exchange and replaced by the Option]. 5. TERM AND EXERCISE OF OPTION 5.1. Term The Option shall terminate and all rights to purchase the shares thereunder shall cease upon the expiration of ten years after [grant date of option tendered for exchange and replaced by the Option], unless terminated earlier pursuant to another provision of this Stock Option Agreement. 5.2. Option Period and Limitations on Exercise The Optionee may exercise the Option (subject to the limitations on exercise set forth in this Stock Option Agreement and in the Plan), to the extent the Option is vested and has not terminated. Any limitation on the exercise of an Option may be rescinded, modified or waived by the Committee, in its sole discretion, at any time and from time to time after the Grant Date of the Option, so as to accelerate the time at which the Option may be exercised. The time at which the Option may be exercised will be accelerated and the Option shall be exercisable, in whole or in part, at any time and from time to time prior to termination of the Option after termination of service by reason of death of Optionee or "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code) of the Optionee. 5.3. Limitations on Exercise of Option Notwithstanding the foregoing Sections, in no event may the Option be exercised: (i) in whole or in part, after ten years following the [grant date of option tendered for exchange and replaced by the Option, (ii) following termination of service for Cause (as defined below) or (iii) following termination of service except as provided in Sections 7.1, 7.2, and 7.3 below. For purposes of this Stock Option Agreement, "Cause" means (i) the commission of a felony or a crime involving moral turpitude or the commission of any other act or omission involving dishonesty or fraud with respect to the Company or any of its affiliates or any of their customers or suppliers, (ii) conduct tending to bring the Company or any of its affiliates into substantial public disgrace or disrepute, (iii) substantial and repeated failure to perform duties of the office held by the Optionee, and such failure is not cured within 30 days after the Optionee receives notice thereof from the Board, (iv) gross negligence or willful misconduct with respect to the Company or any of its affiliates or (v) material breach of any term of any employment, consulting or other services, confidentiality, intellectual property or non- competition agreements, if any, between Optionee and the Company or any of its affiliates. 5.4. Method of Exercise The Option may be exercised, to the extent it is exercisable, by the Optionee's delivery to the Company of written notice of exercise on any business day, at the Company's principal office, addressed to the attention of the Committee. Such notice shall specify the number of shares of Stock with respect to which the Option is being exercised and shall be accompanied by payment in full of the Option Price of the shares for which the Option is being exercised. The minimum number of shares of Stock with respect to which an Option may be exercised, in whole or in part, at any time shall be the lesser of (i) 100 shares and (ii) the maximum number of shares available for purchase under the Option at the time of exercise. Payment of the Option Price for the shares purchased pursuant to the exercise of the Option shall be made (i) in cash or in cash equivalents; (ii) through the tender to the Company of shares of Stock, which shares, if acquired from the Company, shall have been held by the Optionee for at least six months and which shall be valued, for purposes of determining the extent to which the Option Price has been paid thereby, at their Fair Market Value on the date of exercise; or (iii) by a combination of the methods described in (i) and (ii). If the Stock is publicly traded, payment in full of the Option Price need not accompany the written notice of exercise provided that the notice of exercise directs that the certificate or certificates for the shares of Stock for which the Option is exercised be delivered to a licensed broker acceptable to the Company as the agent for the individual exercising the Option and, at the time such certificate or certificates are delivered, the broker tenders to the Company cash (or cash equivalents acceptable to the Company) equal to the Option Price for the shares of Stock purchased pursuant to the exercise of the Option plus the amount (if any) of federal and/or other taxes which the Company may in its judgment, be required to withhold with respect to the exercise of the Option. An attempt to exercise the Option other than as set forth above shall be invalid and of no force and effect. An individual holding or exercising an Option shall have none of the rights of a shareholder (for example, the right to receive cash or dividend payments or distributions attributable to the subject shares of Stock or to direct the voting of the subject shares of Stock ) until the shares of Stock covered thereby are fully paid and issued to him. Except as provided in Section 10 hereof, no adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date of such issuance. 6. PARACHUTE LIMITATIONS Notwithstanding any other provision of this Stock Option Agreement or of any other agreement, contract, or understanding heretofore or hereafter entered into by the Optionee and the Company or any Subsidiary, except an agreement, contract, or understanding hereafter entered into that expressly modifies or excludes application of this Section (the "Other Agreements"), and notwithstanding any formal or informal plan or other arrangement heretofore or hereafter adopted by the Company (or any Subsidiary) for the direct or indirect compensation of the Optionee (including groups or classes of participants or beneficiaries of which the Optionee is a member), whether or not such compensation is deferred, is in cash, or is in the form of a benefit to or for the Optionee (a "Benefit Arrangement"), if the Optionee is a "disqualified individual," as defined in Section 280G(c) of the Code, the Option and any right to receive any payment or other benefit under this Stock Option Agreement shall not become exercisable or vested (i) to the extent that such right to exercise, vesting, payment, or benefit, taking into account all other rights, payments, or benefits to or for Optionee under the Plan, all Other Agreements, and all Benefit Arrangements, would cause any payment or benefit to the Optionee under this Stock Option Agreement to be considered a "parachute payment" within the meaning of Section 280G(b)(2) of the Code as then in effect (a "Parachute Payment") and (ii) if, as a result of receiving a Parachute Payment, the --- aggregate after-tax amounts received by the Optionee from the Company under this Stock Option Agreement, the Plan, all Other Agreements, and all Benefit Arrangements would be less than the maximum after-tax amount that could be received by Optionee without causing any such payment or benefit to be considered a Parachute Payment. In the event that the receipt of any such right to exercise, vesting, payment, or benefit under this Stock Option Agreement, in conjunction with all other rights, payments, or benefits to or for the Optionee under the Plan, any Other Agreement or any Benefit Arrangement would cause the Optionee to be considered to have received a Parachute Payment under this Stock Option Agreement that would have the effect of decreasing the after-tax amount received by the Optionee as described in clause (ii) of the preceding sentence, then the Optionee shall have the right, in the Optionee's sole discretion, to designate those rights, payments, or benefits under this Stock Option Agreement, the Plan, any Other Agreements, and any Benefit Arrangements that should be reduced or eliminated so as to avoid having the payment or benefit to the Optionee under this Stock Option Agreement be deemed to be a Parachute Payment. 7. TERMINATION OF THE SERVICE RELATIONSHIP 7.1. Termination of Service Upon the termination of the Optionee's service with the Company or any of its affiliates or Service Providers other than by reason of death or "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code), the Option or portion thereof held by the Optionee that has not vested in accordance with the provisions of Section 4 hereof shall terminate immediately, and any Option or portion thereof that has vested in accordance with the provisions of Section 4 hereof but has not been exercised shall terminate at the close of business on the 90th day following the Optionee's termination of service (or, if such 90th day is a Saturday, Sunday or holiday, at the close of business on the next preceding day that is not a Saturday, Sunday or holiday), unless the Board of Directors (the "Board"), in its discretion, extends the period during which the Option may be exercised (which period may not be extended beyond the original term of the Option). Upon termination of the Option or portion thereof, the Optionee shall have no further right to purchase shares of Stock pursuant to such Option or portion thereof. Whether a leave of absence or leave on military or government service shall constitute a termination of service for purposes of the Optionee shall be determined by the Board, which determination shall be final and conclusive. For purposes of the Option, a termination of service shall not be deemed to occur if the Optionee is immediately thereafter employed with the Company or any of its affiliates or Service Providers, or is engaged as a Service Provider or an Outside Director of the Company. Whether a termination of a Service Provider's or an Outside Director's relationship with the Company shall have occurred shall be determined by the Committee, which determination shall be final and conclusive. 7.2. Rights in the Event of Death If the Optionee dies while in the service of the Company or any of its affiliates or Service Providers, the executors or administrators or legatees or distributees of such Optionee's estate shall have the right at any time within one year after the date of such Optionee's death, and prior to termination of the Option pursuant to Section 5.1 above, to exercise, in whole or in part, any Option held by such Optionee at the date of such Optionee's death, whether or not such Option was exercisable immediately prior to such Optionee's death. 7.3. Rights in the Event of Disability If the Optionee's service with the Company or any of its affiliates is terminated by reason of the "permanent and total disability" (within the meaning of Section 22(e)(3) of the Code) of the Optionee, then such Optionee shall have the right, at any time within one year after such termination of service and prior to termination of the Option pursuant to Section 5.1 above, to exercise, in whole or in part, the Option held by such Optionee at the date of such termination of service, whether or not such Option was exercisable immediately prior to such termination of service. Whether a termination of service is to be considered by reason of "permanent and total disability" for purposes of this Stock Option Agreement shall be determined by the Committee, which determination shall be final and conclusive. 8. TRANSFERABILITY 8.1. General Rule Except as provided in Section 8.2, during the lifetime of a Optionee, only the Optionee (or, in the event of legal incapacity or incompetency, the Optionee's guardian or legal representative) may exercise the Option. Except as provided in Section 8.2, the Option shall not be assignable or transferable by the Optionee, other than by will or the laws of descent and distribution. 8.2. Family Transfers. An Optionee may transfer all or part of the Option to (i) any Immediate Family Member, (ii) a trust or trusts for the exclusive benefit of any Immediate Family Member, or (iii) a partnership in which Immediate Family Members are the only partners, provided that (x) there may be no consideration for any such transfer, and (y) subsequent transfers of the transferred Option are prohibited except those in accordance with this Section 8.2 or by will or the laws of descent and distribution. Following transfer, the Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, provided that for purposes of Section 8.2 hereof the term "Optionee" shall be deemed to refer to the transferee. The events of termination of the service of Section 7.1 hereof shall continue to be applied with respect to the original Optionee, following which the Option shall be exercisable by the transferee only to the extent and for the periods specified in Sections 7.1, 7.2 or 7.3. "Immediate Family Members" means the spouse, children and grandchildren of the Optionee. 8.3. Legend In order to enforce the restrictions imposed upon shares of Stock under the Plan and this Agreement, the Board may cause a legend or legends to be placed on any certificate representing shares issued pursuant to the Plan that complies with the applicable securities laws and regulations and makes appropriate reference to the restrictions imposed under it. 9. REQUIREMENTS OF LAW The Company shall not be required to sell or issue any securities under the Option if the sale or issuance of such securities would constitute a violation by the Optionee, the individual exercising the Option, or the Company of any provisions of any law or regulation of any governmental authority, including without limitation any federal or state securities laws or regulations. If at any time the Company shall determine, in its discretion, that the listing, registration or qualification of any securities subject to the Option upon any securities exchange or under any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the issuance or purchase of securities hereunder, the Option may not be exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company, and any delay caused thereby shall in no way affect the date of termination of the Option. Specifically in connection with the 1933 Act, upon the exercise of the Option, unless a registration statement under such act is in effect with respect to the securities covered by the Option, the Company shall not be required to sell or issue such securities unless the Committee has received evidence satisfactory to it that the holder of such Option may acquire such securities pursuant to an exemption from registration under such act. Any determination in this connection by the Committee shall be final, binding, and conclusive. The Company may, but shall in no event be obligated to, register any securities covered hereby pursuant to the 1933 Act. The Company shall not be obligated to take any affirmative action in order to cause the exercise of the Option or the issuance of securities pursuant thereto to comply with any law or regulation of any governmental authority. As to any jurisdiction that expressly imposes the requirement that the Option shall not be exercisable until the securities covered by such Option are registered or are exempt from registration, the exercise of such Option (under circumstances in which the laws of such jurisdiction apply) shall be deemed conditioned upon the effectiveness of such registration or the availability of such an exemption. 10. EFFECT OF CHANGES IN CAPITALIZATION 10.1. Changes in Stock If the number of outstanding shares of Stock is increased or decreased or the shares of Stock are changed into or exchanged for a different number or kind of shares or other securities of the Company on account of any recapitalization, reclassification, stock split, reverse split, combination of shares, exchange of shares, stock dividend or other distribution payable in capital stock, or other increase or decrease in such shares effected without receipt of consideration by the Company, occurring after the date of grant of the Option, the number and kind of shares of Stock for which the Option was granted shall be adjusted proportionately and accordingly so that the proportionate interest of the Optionee immediately following such event shall, to the extent practicable, be the same as immediately before such event. Any such adjustment in the Option shall not change the aggregate Option Price payable with respect to shares that are subject to the unexercised portion of the Option but shall include a corresponding proportionate adjustment in the Option Price per share. 10.2. Dissolution, Liquidation, Sale of Assets, Reorganization in Which the Company Is Not the Surviving Entity, Etc. Subject to Section 10.3 hereof, if the Company shall be the surviving entity in any reorganization, merger, or consolidation of the Company with one or more other entities and in which no Change in Control occurs, the Option shall pertain to and apply to the securities to which the Optionee would have been entitled immediately following such reorganization, merger, or consolidation, with a corresponding proportionate adjustment of the Option Price per share so that the aggregate Option Price thereafter shall be the same as the aggregate Option Price of the shares remaining subject to the Option immediately prior to such reorganization, merger, or consolidation. 10.3. Reorganization, Sale of Assets or Sale of Stock Which Involves a Change of Control. Subject to the exceptions set forth in the last sentence of this Section 10.3 (i) upon the occurrence of a Change of Control, fifteen days prior to the scheduled consummation of a Change of Control, the Option shall become immediately exercisable to the extent not previously exercisable and shall remain exercisable for a period of fifteen days. Any exercise of an Option during such fifteen-day period shall be conditioned upon the consummation of the event and shall be effective only immediately before the consummation of the event. Upon consummation of any Change of Control, the Options, to the extent not exercised shall terminate. The Board shall send written notice of an event that will result in such a termination to the Optionee not later than the time at which the Company gives notice thereof to its shareholders. This Section 10.3 shall not apply to any Change of Control to the extent that (A) provision is made in writing in connection with such Change of Control for the assumption of the Option, for the substitution for such Option, of new options covering the stock of a successor entity, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kinds of shares and exercise prices, in which event the Option shall continue in the manner and under the terms so provided or (B) a majority of the full Board determines that such Change of Control shall not trigger application of the provisions of this Section 10.3. 10.4. Adjustments Adjustments under this Section 10 related to stock or securities of the Company shall be made by the Board, whose determination in that respect shall be final, binding, and conclusive. No fractional shares of Stock or units of other securities shall be issued pursuant to any such adjustment, and any fractions resulting from any such adjustment shall be eliminated in each case by rounding downward to the nearest whole share or unit. 10.5. No Limitations on Company The grant of the Option shall not affect or limit in any way the right or power of the Company to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure or to merge, consolidate, dissolve, or liquidate, or to sell or transfer all or any part of its business or assets. 11. DISCLAIMER OF RIGHTS No provision in the Plan or in the Stock Option Agreement shall be construed to confer upon any individual the right to remain in the service of the Company or any of its affiliates or Service Providers, or to interfere in any way with any contractual or other right or authority of the Company or any of its affiliates or Service Providers either to increase or decrease the compensation or other payments to any individual at any time, or to terminate any service between any individual and the Company or any of its affiliates or Service Providers. In addition, notwithstanding anything contained in the Plan to the contrary, the Option shall not be affected by any change of duties or position of the Optionee, so long as the Optionee continues to be a director, officer, consultant or employee of the Company or any of its affiliates or Service Providers. The obligation of the Company to pay any benefits pursuant to this Stock Option Agreement shall be interpreted as a contractual obligation to pay only those amounts described herein, in the manner and under the conditions prescribed herein. The Plan and the Stock Option Agreement shall in no way be interpreted to require the Company to transfer any amounts to a third party trustee or otherwise hold any amounts in trust or escrow for payment to any participant or beneficiary under the terms of the Plan. The Optionee shall not have any of the rights of a shareholder with respect to the shares of Stock subject to an Option except to the extent the certificates for such shares of Stock shall have been issued upon the exercise of the Option. 12. FORFEITURE OF RIGHTS The Company at any time shall have the right to cause a forfeiture of the rights of the Optionee on account of the Optionee taking actions in competition with the Company. Unless otherwise specified in an service or other agreement between the Company and the Optionee, the Optionee takes actions in competition with the Company if he or she directly or indirectly owns any interest in, operates, joins, controls or participates as a partner, director, principal, officer, or agent of, enters into the service of, acts as a consultant to, or performs any services for, any entity which has material operations which compete with any business in which the Company or any of its Subsidiaries is engaged during the Optionee's service with the Company or any of its affiliates or Service Providers or at the time of the Optionee's termination of service. 13. CAPTIONS The use of captions in this Stock Option Agreement is for the convenience of reference only and shall not affect the meaning of any provision of such Stock Option Agreement. 14. WITHHOLDING OF TAXES The Company or a Subsidiary, as the case may be, shall have the right to deduct from payments of any kind otherwise due to the Optionee any Federal, state, or local taxes of any kind required by law to be withheld upon the issuance of any shares of Stock upon the exercise of the Option. At the time of such exercise, the Optionee shall pay to the Company or the Subsidiary, as the case may be, any amount that the Company or the Subsidiary may reasonably determine to be necessary to satisfy such withholding obligation. Subject to the prior approval of the Company or the Subsidiary, which may be withheld by the Company or the Subsidiary, as the case may be, in its sole discretion, the Optionee may elect to satisfy such obligations, in whole or in part, (i) by causing the Company or the Subsidiary to withhold shares of Stock otherwise issuable to the Optionee or (ii) by delivering to the Company or the Subsidiary shares of Stock already owned by the Optionee. The shares of Stock so delivered or withheld shall have an aggregate Fair Market Value equal to such withholding obligations. The Fair Market Value of the shares of Stock used to satisfy such withholding obligation shall be determined by the Company or the Subsidiary as of the date that the amount of tax to be withheld is to be determined. The Optionee who has made an election pursuant to this Section 14 may satisfy his or her withholding obligation only with shares of Stock that are not subject to any repurchase, forfeiture, unfulfilled vesting, or other similar requirements. 15. SEVERABILITY If any provision of the Plan or this Stock Option Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions thereof and hereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction. 16. INTERPRETATION OF THIS STOCK OPTION AGREEMENT All decisions and interpretations made by the Company or the Committee with regard to any question arising under the Plan or this Stock Option Agreement shall be final, binding and conclusive on the Company and the Optionee and any other person entitled to exercise the Option as provided for herein. 17. GOVERNING LAW The validity and construction of this Stock Option Agreement shall be governed by the laws of the State of Delaware but not including the choice of law rules thereof. 18. BINDING EFFECT Subject to all restrictions provided for in this Stock Option Agreement, the Plan and by applicable law limiting assignment and transfer of this Stock Option Agreement and the Option provided for herein, this Stock Option Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and assigns. 19. NOTICE All notices or other communications which may be or are required to be given by any party to any other party pursuant to this Stock Option Agreement shall be in writing and shall be mailed by first-class, registered or certified mail, return receipt requested, postage prepaid, or transmitted by hand delivery or telecopier (fax), addressed as follows: If to the Company: Answerthink, Inc. 1001 Brickell Bay Drive, Suite 3000 Miami, Florida 33131 Attention: Jack Brennan Telecopy: 305/379-8810 If to Optionee: At the address set forth below under Optionee's name at the foot of this Agreement. Each party may designate by notice in writing a new address to which any notice or other communication may thereafter be so given. Each notice or other communication which shall be mailed, delivered or transmitted in the manner described above, shall be deemed sufficiently given for all purposes at such time as it is delivered to the addressee with the return receipt, the delivery receipt, the affidavit of personal courier or, with respect to a telecopy, upon acknowledgment of receipt thereof and in all cases at such time as delivery is refused by the addressee upon presentation. 20. ENTIRE AGREEMENT This Stock Option Agreement and the Plan together constitute the entire agreement between the parties hereto with respect to the subject matter hereof. Neither this Stock Option Agreement nor any term hereof may be amended, waived, discharged or terminated except by a written instrument signed by the Company and the Optionee; provided, however, that the Company unilaterally may -------- ------- waive any provision hereof in writing to the extent that such waiver does not adversely affect the interests of the Optionee hereunder, but no such waiver shall operate as or be construed to be a subsequent waiver of the same provision or a waiver of any other provision hereof. IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Stock Option Agreement, or caused this Stock Option Agreement to be duly executed and delivered in their name and on their behalf, as of the day and year first above written. Answerthink, Inc. By:________________________ OPTIONEE: ___________________________ [Name of Optionee] ADDRESS FOR NOTICE TO OPTIONEE: ___________________________ ___________________________ ___________________________ [Address of Optionee] Exhibit A: Answerthink, Inc. 1998 Stock Option and Incentive Plan - --------- -----END PRIVACY-ENHANCED MESSAGE-----