-----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, QIaUrb+K783xo7VX6eJmki8Gb7RCkjNLu0KeF2ND7QcRq0MLuguXMZmnob2d+VTq A4dFaY5Yj8GFm4Riy0P5ug== /in/edgar/work/20000609/0000912057-00-028040/0000912057-00-028040.txt : 20000919 0000912057-00-028040.hdr.sgml : 20000919 ACCESSION NUMBER: 0000912057-00-028040 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20000609 EFFECTIVENESS DATE: 20000609 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIONBRIDGE TECHNOLOGIES INC /DE/ CENTRAL INDEX KEY: 0001058299 STANDARD INDUSTRIAL CLASSIFICATION: [7389 ] IRS NUMBER: 043398462 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-38996 FILM NUMBER: 652693 BUSINESS ADDRESS: STREET 1: 950 WINTER STREET STREET 2: SUITE 4300 CITY: WALTHAM STATE: MA ZIP: 02154 BUSINESS PHONE: 7818906612 MAIL ADDRESS: STREET 1: 950 WINTER STREET CITY: WALTHAM STATE: MA ZIP: 02451 FORMER COMPANY: FORMER CONFORMED NAME: LIONBRIDGE TECHNOLOGIES HOLDINGS INC DATE OF NAME CHANGE: 19990611 S-8 1 s-8.txt S-8 As filed with the Securities and Exchange Commission on June 9, 2000 Registration No. 333-______ ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------- LIONBRIDGE TECHNOLOGIES, INC. (Exact Name of Registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 04-3398462 (I.R.S. Employer Identification No.) 950 Winter Street Waltham, MA 02451 (Address of Principal Executive Offices) (Zip Code) -------------------- IC Global Services, Inc. 1998 Stock Plan (Amended and Restated April 6, 1999) International Language Engineering Corporation Amended and Restated 1997 Stock Option Plan Harvard Translations, Inc. 1997 Stock Option Plan (Full title of the plans) -------------------- Rory J. Cowan Chief Executive Officer Lionbridge Technologies, Inc. 950 Winter Street Waltham, MA 02451 (Name and Address of Agent for Service of Process) (781) 434-6000 (Telephone Number, Including Area Code, of Agent For Service) -------------------- Copy to: George W. Lloyd, Esq. Kathy A. Fields, Esq. Testa, Hurwitz & Thibeault, LLP 125 High Street Boston, Massachusetts 02110 (617) 248-7000 ================================================================================ ================================================================================ CALCULATION OF REGISTRATION FEE ================================================================================
PROPOSED MAXIMUM PROPOSED OFFERING MAXIMUM PRICE AGGREGATE AMOUNT OF TITLE OF SECURITIES AMOUNT TO BE PER OFFERING REGISTRATION TO BE REGISTERED REGISTERED SHARE PRICE FEE (2) - ---------------- ------------ -------- ---------- ------------ HARVARD TRANSLATIONS, INC. 1997 STOCK OPTION PLAN Common Stock (par value $.01 per share) 5,829 $5.67(1) $33,050.43 78,699 $7.60(1) $598,112.40 20,403 $9.01(1) $183,831.03 IC GLOBAL SERVICES, INC. 1998 STOCK PLAN (AMENDED AND RESTATED APRIL 6, 1999) Common Stock (par value $.01 per share) 275,140 $1.72(1) $473,240.80 302,680 $4.92(1) $1,489,185.60 4,540 $17.58(1) $79,813.20 INTERNATIONAL LANGUAGE ENGINEERING CORPORATION AMENDED AND RESTATED 1997 STOCK OPTION PLAN Common Stock (par value $.01 per share) 43,343 $1.09(1) $47,243.87 15,307 $1.31(1) $20,052.17 ------- ------------- TOTAL: 745,941 $2,924,529.50 $772.08 ======= ============= =======
- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (1) All such shares are issuable upon exercise of outstanding options with fixed exercise prices. Pursuant to Rule 457(h)(1) under the Securities Act of 1933, as amended, the aggregate offering price and the fee have been computed upon the basis of the price at which the options may be exercised. The offering price per share set forth for such shares is the exercise price per share at which such options are exercisable. (2) Calculated pursuant to Section 6(b) of the Securities Act of 1933, as amended. -2- PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS Item 1. Plan Information. The documents containing the information specified in this Item 1 will be sent or given to employees, as specified by Rule 428(b)(1). In accordance with the rules and regulations of the Securities and Exchange Commission (the "Commission") and the instructions to Form S-8, such documents are not being filed with the Commission either as part of this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424. Item 2. Registrant Information and Employee Plan Annual Information. The documents containing the information specified in this Item 2 will be sent or given to employees as specified by Rule 428(b). In accordance with the rules and regulations of the Commission and the instructions to Form S-8, such documents are not being filed with the Commission either as part of this Registration Statement or as prospectuses or prospectus supplements pursuant to Rule 424. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. The following documents filed with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act") are incorporated by reference in this Registration Statement: (a) Registrant's Annual Report on Form 10-K, for the year ended December 31, 1999, filed with the Commission pursuant to the Exchange Act on March 7, 2000. (b) Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, filed with the Commission on May 12, 2000. (c) Registrant's Current Report on Form 8-K filed on June 1, 2000 pursuant to the Exchange Act. (d) The section entitled "Description of Registrant's Securities to be Registered" contained in the Registrant's Registration Statement on Form 8-A filed on August 4, 1999 pursuant to Section 12(g) of the Exchange Act, and incorporating by reference the information contained in the Registrant's Registration Statement on Form S-1 (File No. 333-81233). All documents subsequently filed with the Commission by the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates that all securities offered herein have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part thereof from the date of filing of such documents. -3- Item 4. Description of Securities. Not applicable. Item 5. Interest of Named Experts and Counsel. Not applicable. Item 6. Indemnification of Directors and Officers. The Delaware General Corporation Law and the Registrant's Second Amended and Restated Certificate of Incorporation and Amended and Restated By-laws provide for indemnification of the Registrant's directors and officers for liabilities and expenses that they may incur in such capacities. In general, directors and officers are indemnified with respect to actions taken in good faith in a manner reasonably believed to be in, or not opposed to, the best interests of the Registrant, and with respect to any criminal action or proceeding, actions that the indemnitee had no reasonable cause to believe were unlawful. Reference is made to the Registrant's Second Amended and Restated Certificate of Incorporation and Amended and Restated By-laws filed as Exhibits 3.2 and 3.4, respectively, to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference. The underwriting agreement, dated August 20, 1999, by and between the Registrant and the underwriters listed therein provides that the underwriters are obligated, under certain circumstances, to indemnify directors, officers and controlling persons of the Registrant against certain liabilities, including liabilities under the Securities Act of 1933. Reference is made to the form of underwriting agreement filed as Exhibit 1.1 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference. The Registrant has in effect a directors' and officers' liability insurance policy. Item 7. Exemption From Registration Claimed. Not applicable. -4- Item 8. Exhibits. Exhibit No. Description of Exhibit - ----------- ---------------------- 4.1 Specimen Certificate for shares of the Registrant's Common Stock (filed as Exhibit 4.3 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference). 4.2 Second Amended and Restated Certificate of Incorporation (filed as Exhibit 3.2 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference). 4.3 Amended and Restated By-laws of the Registrant (filed as Exhibit 3.4 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference). 4.4 Harvard Translations, Inc. 1997 Stock Option Plan. 4.5 IC Global Services, Inc. 1998 Stock Plan (Amended and Restated April 6, 1999). 4.6 International Language Engineering Corporation Amended and Restated 1997 Stock Option Plan. 5.1 Opinion of Testa, Hurwitz & Thibeault, LLP. 23.1 Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit 5.1). 23.2 Consent of PricewaterhouseCoopers LLP. 24.1 Power of Attorney (included as part of the signature page of this Registration Statement). Item 9. Undertakings. (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of -5- prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference herein shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue. -6- SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Waltham in the Commonwealth of Massachusetts, on this 9th day of June, 2000. LIONBRIDGE TECHNOLOGIES, INC. By: /s/ Rory J. Cowan --------------------------------------- Rory J. Cowan Chief Executive Officer and Chairman of the Board (Principal Executive Officer) POWER OF ATTORNEY AND SIGNATURES We, the undersigned officers and directors of Lionbridge Technologies, Inc., hereby severally constitute and appoint Rory J. Cowan and Stephen J. Lifshatz, and each of them singly, our true and lawful attorneys, with full power to them and each of them singly, to sign for us in our names in the capacities indicated below, any amendments to this Registration Statement on Form S-8 (including post-effective amendments), and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, and generally to do all things in our names and on our behalf in our capacities as officers and directors to enable Lionbridge Technologies, Inc., to comply with the provisions of the Securities Act of 1933, as amended, and all requirements of the Securities and Exchange Commission. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE /s/ Rory J. Cowan Chief Executive Officer, Chairman June 9, 2000 - ----------------------------- of the Board (Principal Executive Officer) Rory J. Cowan /s/ Roger O. Jeanty President, Director June 9, 2000 - ----------------------------- Roger O. Jeanty /s/ Stephen J. Lifshatz Senior Vice President, Chief Financial Officer, June 9, 2000 - ----------------------------- Treasurer and Secretary (Principal Financial Stephen J. Lifshatz and Accounting Officer) /s/ Guy L. de Chazal Director June 9, 2000 - ----------------------------- Guy L. de Chazal Director - ----------------------------- Marcia J. Hooper /s/ Paul Kavanagh Director June 7, 2000 - ----------------------------- Paul Kavanagh /s/ Claude P. Sheer Director June 7, 2000 - ----------------------------- Claude P. Sheer
-7- INDEX TO EXHIBITS Exhibit No. Description of Exhibit - ----------- ---------------------- 4.1 Specimen Certificate for shares of the Registrant's Common Stock (filed as Exhibit 4.3 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference). 4.2 Second Amended and Restated Certificate of Incorporation (filed as Exhibit 3.2 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference). 4.3 Amended and Restated By-laws of the Registrant (filed as Exhibit 3.4 to the Registrant's Registration Statement on Form S-1 (File No. 333-81233) and incorporated herein by reference). 4.4 Harvard Translations, Inc. 1997 Stock Option Plan. 4.5 IC Global Services, Inc. 1998 Stock Plan (Amended and Restated April 6, 1999). 4.6 International Language Engineering Corporation Amended and Restated 1997 Stock Option Plan. 5.1 Opinion of Testa, Hurwitz & Thibeault, LLP. 23.1 Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit 5.1). 23.2 Consent of PricewaterhouseCoopers LLP. 24.1 Power of Attorney (included as part of the signature page of this Registration Statement). EX-4.4 2 ex-4_4.txt EXHIBIT 4-4 EXHIBIT 4.4 2/27/97 HARVARD TRANSLATIONS, INC. 1997 STOCK OPTION PLAN 1. Purpose The purpose of this plan (the "Plan") is to secure for Harvard Translations, Inc. (the "Company") and its shareholders the benefits arising from capital stock ownership by employees, officers and directors of, and consultants or advisors to, the Company and its parent and subsidiary corporations who are expected to contribute to the Company's future growth and success. Except where the context otherwise requires, the term "Company" shall include the parent and all present and future subsidiaries of the Company as defined in Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended or replaced from time to time (the "Code"). Those provisions of the Plan which make express reference to Section 422 shall apply only to Incentive Stock Options (as that term is defined in the Plan). 2. Types of Options and Administration. (a) Types of Options. Options granted pursuant to the Plan ("Options") shall be authorized by action of the Board of Directors of the Company and may be either incentive stock options ("Incentive Stock Options") meeting the requirements of Section 422 of the Code or non-statutory Options which are not intended to meet the requirements of Section 422 of the Code. All Options when granted are intended to be non-statutory Options, unless the applicable Option Agreement (as defined below) explicitly states that the Option is intended to be an Incentive Stock Option. If an Option is intended to be an Incentive Stock Option, and if for any reason such Option (or any portion thereof) shall not qualify as an Incentive Stock Option, then, to the extent of such nonqualification, such Option (or portion thereof) shall be regarded as a non-statutory Option appropriately granted under the Plan provided that such Option (or portion thereof) otherwise meets the Plan's requirements relating to non-statutory Options. (b) Administration. The Plan shall be administered by the Board of Directors of the Company, whose construction and interpretation of the terms and provisions of the Plan shall be final and conclusive. The Board of Directors may in its sole discretion grant options to purchase shares of the Company's common stock, $.01 par value ("Common Stock"), and issue shares upon exercise of such Options as provided in the Plan. The Board shall have authority, subject to the express provisions of the Plan, to construe the respective Option Agreements and the Plan, to prescribe, amend and rescind rules and regulations relating to the Plan, to determine the terms and provisions of the respective Option Agreements, which need not be identical, and to make all other determinations in the judgment of the Board of Directors necessary or desirable for the administration of the Plan. The Board of Directors may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Option Agreement in the manner and to the extent it shall deem expedient to carry the Plan into effect and it shall be the sole and final judge of such expediency. No director or person acting pursuant to authority delegated by the Board of Directors shall be liable for any action or determination under the Plan made in good faith. The Board of Directors may, to the full extent permitted by or consistent with applicable laws or regulations (including, without limitation, applicable state law, delegate any or all of its powers under the Plan to a committee (the "Committee") appointed by the Board of Directors, and if the Committee is so appointed all references to the Board of Directors in the Plan shall mean and relate to such Committee. 3. Eligibility. Options may be granted to persons who are, at the time of such grant, employees, officers or directors of, or consultants or advisors to, the Company; provided, that the class of persons to whom Incentive Stock Options may be granted shall be limited to employees of the Company. 4. Stock Subject to Plan. Subject to adjustment as provided in Section 14 below, the maximum number of shares of Common Stock of the Company which may be issued under the Plan is 40,000 shares. If an Option shall expire or terminate for any reason without having been exercised in full, the unpurchased shares subject to such Option shall again be available for subsequent Option grants under the Plan. If shares issued upon exercise of an Option are tendered to the Company in payment of the exercise price of an Option, such tendered shares shall again be available for subsequent Option grants under the Plan; provided that in no event shall the total number of shares issued pursuant to the exercise of Incentive Stock Options under the Plan, on a cumulative basis, exceed the number of shares authorized for issuance under the Plan, exclusive of shares made available for issuance pursuant to this sentence. 5. Forms of Option Agreements. (a) Option Agreement. As a condition to the grant of an Option, each recipient of an Option shall execute an option agreement ("Option Agreement") in such form not inconsistent with the Plan as may be approved by the Board of Directors. Such Option Agreements may differ among recipients. (b) "Stand-Off" Agreement. Unless the Board of Directors specifies otherwise, each Option Agreement shall provide that upon the request of the Company or the managing Underwriter(s), the holder of any Option shall, in connection with an initial public offering of the Common Stock, agree in writing that for a period of time (not to exceed 180 days) from the effective date of the Securities and Exchange Commission registration statement for such offering, the holder or purchaser will not sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any shares of Common Stock owned or controlled by him. 6. Purchase Price. (a) General. The purchase price per share of stock deliverable upon the exercise of an Option shall be determined by the Board of Directors, provided, however, that in the case of an Incentive Stock Option, the exercise price shall not be less than 100% of the fair market value of such stock, as determined by the Board of Directors at the time of grant of such Option, or less than 110% of such fair market value in the case of Options described in Section 11(b). (b) Payment of Purchase Price. Option Agreements may provide for the payment of the exercise price by delivery of cash or a check to the order of the Company in an amount equal to the exercise price of such Options, or, to the extent provided in the applicable Option Agreement, (i) by delivery to the Company of shares of common stock of the Company having a fair market value equal in amount to the exercise price of the Options being exercised, (ii) by any other means (including, without limitation, by delivery of a promissory note of the optionee payable on such terms as are specified by the Board of Directors) which the Board of Directors determines are consistent with the purpose of the Plan and with applicable laws and regulations, or (iii) by any combination of such methods of payment. The fair market value of any shares of the Company's -2- common stock or other non-cash consideration which may be delivered upon exercise of an Option shall be determined by the Board of Directors. 7. Option Period. Each Option and all rights thereunder shall expire on such date as shall be set forth in the applicable Option Agreement; provided that, in any event, in the case of an Incentive Stock Option, such date shall not be later than 10 years after the date on which the Option is granted (or five years in the case of Options described in Section 11(b)) and, in the case of non-statutory Options, not later than 10 years after the dates on which the Option is granted, and, in either case, shall be subject to earlier termination as provided in the Plan. 8. Exercise of Options. Each Option shall be exercisable either in full or in installments at such time or times and during such period as shall be set forth in the agreement evidencing such Option, subject to the provisions of the Plan. 9. Nontransferability of Options. No Option shall be assignable or transferable by the person to whom it is granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution. During the life an optionee, an Option held by him or her shall be exercisable only by the optionee. 10. Effect of Termination. No Incentive Stock Option may be exercised unless, at the time of such exercise, the optionee is, and has continuously since the date of grant of his or her Incentive Stock Option, been employed by the Company except that, unless the Option Agreement expressly provides otherwise: (a) except as provided in paragraphs (b) and (c) below, the Incentive Stock Option may be exercised within the period of ninety days after the date the optionee ceases to be an employee of the Company for any reason other than termination of the optionee's employment voluntarily by the optionee or by the Company for cause (as determined by the Company) or within ninety days after the optionee's retirement in good standing from the Company for reasons of age under the then established rules of the Company; (b) if the optionee dies while in the employ of the Company, the Incentive Stock Option may be exercised by the person to whom it is transferred by will or the laws of descent and distribution within the period of one year after the date of death (or within such lesser period as may be specified in the applicable Option Agreement); and (c) if the optionee becomes disabled (within the meaning of Section 22(e)(3) of the Code or any successor provision thereto) while in the employ of the Company, the Incentive Stock Option may be exercised within the period of one year after the date the optionee ceases to be such an employee because of such disability (or within such lesser period as may be specified in the applicable Option Agreement); provided, however, that (i) any Incentive Stock Option may only be exercised to the extent such Option was exercisable by the optionee on the date of termination of the optionee's employment with the Company and (ii) in no event may any Incentive Stock Option be exercised after the expiration date of the Incentive Stock Option. For all purposes of the Plan and any Incentive Stock -3- Option granted hereunder, "employment" shall be defined in accordance with the provisions of Section 1.421-7(h) of the Income Tax Regulations (or any successor regulations). Unless the applicable Option Agreement expressly provides otherwise, a non-statutory Option granted to an employee shall be subject to the foregoing provisions of this Section 10 as if it were an Incentive Stock Option, but a non-statutory Option may also be exercised so long as the optionee maintains a relationship with the Company as a director, consultant, or adviser. 11. Incentive Stock Options. Options which are intended to be Incentive Stock Options shall be subject to the following additional terms and conditions: (a) Express Designation. All Incentive Stock Options shall, at the time of grant, be specifically designated as such in the Option Agreement covering such Incentive Stock Options. (b) 10% Shareholder. If any employee to whom in Incentive Stock Option is to be granted is, at the time of the grant of such Option, the owner of stock possessing more than 10% of the total combined voting power of all classes of stock of the Company (after taking into account the attribution of stock ownership rules of Section 424(d) of the Code), then the following special provisions shall be applicable to the Incentive Stock Option granted to such individual: (i) The purchase price per share of the Common Stock subject to such Incentive Stock Option shall not be less than 110% of the fair market value of one share of Common Stock at the time of grant; and (ii) the option exercise period shall not exceed five years from the date of grant. (c) Dollar Limitation. For so long as the Code shall so provide, Options granted to any employee under the Plan (and any other incentive stock option plans of the Company) which are intended to constitute Incentive Stock Options shall not constitute Incentive Stock Options to the extent that such Options, in the aggregate, become exercisable for the first time in any one calendar year for shares of Common Stock with an aggregate fair market value (determined as of the respective date or dates of grant) of more than $100,000. 12. Additional Provisions. (a) Additional Provisions. The Board of Directors may, in its sole discretion, include additional provisions in Option Agreements, including without limitation restrictions on transfer, rights of the Company to repurchase shares of Common Stock acquired upon exercise of Options or rights of first refusal of the Company with respect to such shares, commitments to pay cash bonuses, to make, arrange for or guaranty loans or to transfer other property to optionees upon exercise of Options, or such other provisions as shall be determined by the Board of Directors; provided that such additional provisions shall not be inconsistent with any other term or condition of the Plan and such additional provisions shall not be such as to cause any Incentive Stock Option to fail to qualify as an Incentive Stock Option within the meaning of Section 422 of the Code. (b) Acceleration, Extension, Etc. The Board of Directors may, in its sole discretion, (i) accelerate the date or dates on which all or any particular Option or Options may be exercised or (ii) extend the dates during which all, or any particular, Option or Options may be exercised; provided, however, that no such extension shall be permitted if it would cause the Plan to fail to comply with Section 422 of the Code. -4- 13. Rights as a Shareholder. The holder of an Option shall have no rights as a shareholder with respect to any shares covered by the Option (including, without limitation, any rights to receive dividends or non-cash distributions with respect to such shares) until the date of issue of a stock certificate to him or her for such shares. No adjustment shall be made for dividends or other rights for which the record date is prior to the date such stock certificate is issued. 14. Adjustment Provisions for Recapitalizations and Related Transactions. (a) General. If, through or as a result of any merger, consolidation, sale of all or substantially all of the assets of the Company, reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction, (i) the outstanding shares of Common Stock are increased, decreased or exchanged for a different number or kind of shares or other securities of the Company, or (ii) additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such shares of Common Stock or other securities, an appropriate and proportionate adjustment may be made in (x) the maximum number and kind of shares reserved for issuance under the Plan, (y) the number and kind of shares or other securities subject to any then outstanding Options, and (z) the price for each share subject to any then outstanding Options, without changing the aggregate purchase price as to which such Options remain exercisable. Notwithstanding the foregoing, no adjustment shall be made pursuant to this Section 14 if such adjustment would cause the Plan to fail to comply with Section 422 of the Code. (b) Board Authority to Make Adjustments. Any adjustments under this Section 14 will be made by the Board of Directors, whose determination as to what adjustments, if any, will be made and the extent thereof will be final, binding and conclusive. No fractional shares will be issued under the Plan on account of any such adjustments. 15. Merger, Consolidation, Asset Sale, Liquidation, etc. (a) General. In the event of a consolidation or merger or sale of all or substantially all of the stock or assets of the Company in which outstanding shares of Common Stock are exchanged for securities, cash or other property of any other corporation or business entity or in the event of a liquidation of the Company, the Board of Directors of the Company, or the board of directors of any corporation assuming the obligations of the Company, may, in its discretion, take any one or more of the following actions, as to some or all outstanding Options (and need not take the same action as to each such Option): (i) provide that such Options shall be assumed, or equivalent Options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof), provided that any such Options substituted for Incentive Stock Options shall meet the requirements of Section 424(a) of the Code, (ii) upon written notice to the optionees, provide that all unexercised Options will terminate immediately prior to the consummation of such transaction unless exercised by the optionee within a specified period following the date of such notice, (iii) in the event of a merger under the terms of which holders of the Common Stock of the Company will receive upon consummation thereof a cash payment for each share surrendered in the merger (the "Merger Price"), make or provide for a cash payment to the optionees equal to the difference between (A) the Merger Price times the number of shares of Common Stock subject to such outstanding Options (to the extent then exercisable at prices not in excess of the Merger Price) and (B) the aggregate exercise price of all such outstanding Options in exchange for the termination of such Options, and (iv) provide that the vesting of all or any outstanding Options shall be accelerated in whole or in part immediately prior to such event. -5- (b) Substitute Options. The Company may grant Options in substitution for Options held by employees of another corporation who become employees of the Company, or a subsidiary of the Company, as the result of a merger or consolidation of the employing corporation with the Company or a subsidiary of the Company, or as a result of the acquisition by the Company, or one of its subsidiaries, of property or stock of the employing corporation. The Company may direct that substitute Options be granted on such terms and conditions as the Board of Directors considers appropriate in the circumstances. 16. No Special Employment Rights. Nothing contained in the Plan or in any Option shall confer upon any optionee any right with respect to the continuation of his or her employment by the Company or interfere in any way with the right of the Company at any time to terminate such employment or to increase or decrease the compensation of the optionee. 17. Other Employee Benefits. The amount of any compensation deemed to be received by an employee as a result of the grant or exercise of an Option or the sale of shares received upon such exercise will not constitute compensation with respect to which any other employee benefits of such employee are determined, including, without limitation, benefits under any bonus, pension, profit-sharing, life insurance or salary continuation plan, except as otherwise specifically determined by the Board of Directors. 18. Amendment of the Plan. (a) The Board of Directors may at any time, and from time to time, modify or amend the Plan in any respect, except that if at any time the approval of the shareholders of the Company is required under Section 422 of the Code or any successor provision with respect to Incentive Stock Options, the Board of Directors may not effect such modification or amendment without such approval. (b) The termination or any modification or amendment of the Plan shall not, without the consent of an optionee, affect his or her rights under an Option previously granted to him or her. With the consent of the optionee affected, the Board of Directors may amend outstanding Option Agreements in a manner not inconsistent with the Plan. The Board of Directors shall have the right to amend or modify the terms and provisions of the Plan and of any outstanding Incentive Stock Options to the extent necessary to qualify any or all such Options for such favorable federal income tax treatment (including deferral of taxation upon exercise) as may be afforded incentive stock options under Section 422 of the Code. 19. Withholding. The Company 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 with respect to issuance of any shares upon exercise of Options. Subject to the prior approval of the Company, which may be withheld by the Company in its sole discretion, the obligor may elect to satisfy such obligations, in whole or in part, (i) by causing the Company to withhold shares of Common Stock otherwise issuable or (ii) by delivering to the Company shares of Common Stock already owned by the obligor. The shares so delivered or withheld shall have a fair market value equal to such withholding obligation. The fair market value of the shares used to satisfy such withholding obligation shall be determined by the Company as of the date that the amount of tax to be withheld -6- is to be determined. A person who has made an election pursuant to this Section 19 may only satisfy his or her withholding obligation with shares of Common Stock which are not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements. 20. Effective Date and Duration of the Plan. (a) Effective Date. The Plan shall become effective when adopted by the Board of Directors, but no Incentive Stock Option shall become exercisable unless and until the Plan shall have been approved by the Company's shareholders. If such shareholder approval is not obtained within twelve months after the date of the Board's adoption of the Plan, no Options previously granted under the Plan shall be deemed to be Incentive Stock Options and no Incentive Stock Options shall be granted thereafter. Amendments to the Plan not requiring shareholder approval shall become effective when adopted by the Board of Directors; amendments requiring shareholder approval (as provided in Section 18) shall become effective when adopted by the Board of Directors, but no Incentive Stock Option granted after the date of such amendment shall become exercisable (to the extent that such amendment to the Plan was required to enable the Company to grant such Incentive Stock Option to a particular optionee) unless and until such amendment shall have been approved by the Company's shareholders. If such shareholder approval is not obtained within twelve months of the Board's adoption of such amendment, any Incentive Stock Options granted on or after the date of such amendment shall terminate to the extent that such amendment to the Plan was required to enable the Company to grant such Option to a particular optionee. Subject to this limitation, Options may be granted under the Plan at any time after the effective date and before the date fixed for termination of the Plan. (b) Termination. Unless sooner terminated in accordance with Section 15 or by the Board of Directors the Plan shall terminate upon the close of business on the day next preceding the tenth anniversary of the date of its adoption by the Board of Directors. Options outstanding on such date shall continue in force and effect in accordance with the provisions of the Plan and the applicable Option Agreements. 21. Restriction on Transfer or Exercise to Preserve the Company's S-Corporation Status. In addition to any other restriction on the transfer or encumbrance of Common Stock acquired upon exercise of an Option, no holder thereof may transfer any shares of such Common Stock whether by sale, gift, bequest, operation of law, or otherwise, if, in the opinion of legal counsel to the Company, transfer might result in the termination of the Company's S-corporation status for any reason (including by reason of creating more than the allowed number of shareholders under Section 1361 of the Code). No such holder may encumber Common Stock of the Company acquired upon exercise of any Option if, in the opinion of legal counsel to the Company, a possible result thereof might be a subsequent transfer prohibited under the immediately preceding sentence. Any such transfer or encumbrance in violation of this Section 21 shall be null and void and shall not be recognized on the books and records of the Company, and the holder making the purported transfer shall retain the right to vote and receive distributions and shall continue to report the share of income or loss allocated by the Company to such holder for tax purposes. No Option granted hereunder may be exercised if, in the opinion of legal counsel to the Company, such exercise might result in termination of the Company's S-corporation status for any reason (including by reason of creating more than the allowed number of shareholders under Section 1361 of the Code), except that this provision shall not postpone the right of exercise of any Option beyond its expiration. 22. Provision for Foreign Participants. -7- The Board of Directors may, without amending the Plan, modify the terms of Option Agreements to differ from those specified in the Plan with respect to participants who are foreign nationals or employed outside the United States to recognize differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters. * * * -8- EX-4.5 3 ex-4_5.txt EXHIBIT 4-5 EXHIBIT 4.5 IC GLOBAL SERVICES, INC. 1998 STOCK PLAN (Amended and Restated April 6, 1999) TABLE OF CONTENTS Page ---- 1. Names and Purposes of the Plan ......................................... 1 2. Definitions ............................................................ 1 3. Administration of Plan ................................................. 2 (a) Procedure ........................................................ 2 (b) Limitations on Members of Board .................................. 3 (c) Powers of the Board .............................................. 3 (d) Effect of the Board's or Committee's Decision .................... 3 4. Stock Subject to the Plan .............................................. 3 5. Eligibility ............................................................ 4 6. Term of the Plan ....................................................... 4 7. Option Agreement and Option Period ..................................... 4 8. Price and Consideration ................................................ 4 (a) Price ............................................................ 4 (b) Fair Market Value ................................................ 5 (c) Form of Consideration ............................................ 5 (d) Promissory Notes ................................................. 5 (e) Surrendered Common Stock ......................................... 5 (f) Exercise/Sale .................................................... 5 (g) Exercise/Pledge .................................................. 5 9. Limit on Value of Incentive Options .................................... 6 10. Exercise of Option ..................................................... 6 (a) General Terms .................................................... 6 (b) Survival of Options .............................................. 6 (c) Partial Exercise ................................................. 6 (d) Time of Exercise ................................................. 6 (e) No Rights as Stockholder Until Exercise .......................... 6 (f) Issuance of Share Certificates ................................... 6 (g) Reduction of Shares Upon Exercise ................................ 7 11. Termination of Employment; Death or Disability ......................... 7 (a) General .......................................................... 7 (b) Death or Disability .............................................. 7 (c) Definition of Termination ........................................ 7 12. Non-Transferability of Options ......................................... 7 13. Adjustment Upon Changes in Capitalization .............................. 7 (a) Reorganizations, Recapitalizations, Etc. ......................... 7 (b) Corporate Transactions ........................................... 8 (c) No Fractional Shares ............................................. 8 - i - (d) Binding Effect of Board Determinations ........................... 8 (e) No Other Adjustments ............................................. 8 14. Amendment and Termination of the Plan .................................. 8 (a) Amendment and Termination ........................................ 8 (b) Effect of Termination ............................................ 9 15. Conditions Upon Issuance of Shares ..................................... 9 16. Reservation of Shares .................................................. 9 17. Taxes and Withholding of Taxes ......................................... 9 18. Stockholder Approval of the Plan ....................................... 9 19. Liability of Company ................................................... 9 20. Notices ................................................................ 9 21. Terms and Conditions of Stock Purchase Rights .......................... 10 (a) Stock issuance Agreement ......................................... 10 (b) Duration of Offers and Nontransferability of Rights .............. 10 (c) Purchase Price ................................................... 10 (d) Withholding Taxes ................................................ 10 (e) Restrictions on Transfer of Shares and Minimum Vesting ........... 10 (f) Accelerated Vesting .............................................. 10 22. No Enlargement of Service Rights ....................................... 10 23. Legends on Certificates ................................................ 11 (a) Federal Law ...................................................... 11 (b) State Legend ..................................................... 11 24. Invalid Provisions ..................................................... 11 25. Financial Reports ...................................................... 11 26. Modification, Extension and Assumption of Options ...................... 11 27. Repurchase of Vested Shares ............................................ 11 28. Governing Law .......................................................... 12 - ii - 1. Names and Purposes of the Plan. The Plan provides for the granting of options that are intended to qualify as incentive stock options within the meaning of Section 422(b) of the Internal Revenue Code of 1986, as amended, and options that are not intended to so qualify. The Plan also provides for the grant of Stock Purchase Rights. The purposes of the Plan are: (a) to attract and retain the best available people for positions with the Company; and (b) to provide additional incentive to Employees, Outside Directors and Consultants of the Company and any future Parents and Subsidiaries, and to promote the success of the Company's business. 2. Definitions. For purposes of the Plan, the following terms will have the respective meanings indicated: (a) "Board" shall mean the Board of Directors of the Company. (b) "Buy-Sell Provisions" shall mean the buy-sell provisions which are to be a condition of purchasing Optioned Shares upon the exercise of an Option under the Plan. (c) "Code" shall mean the Internal Revenue Code of 1986, as amended. (d) "Common Stock" shall mean the common stock of the Company. (e) "Committee" shall mean the committee appointed by the Board in accordance with Paragraph 3(a) of this Plan, if one is appointed. (f) "Consultant" shall mean a person who performs bona fide services for the Company, a Parent or a Subsidiary as a consultant or advisor, excluding Employees and Outside Directors. (g) "Corporate Transaction" shall mean the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not stockholders of the Company immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization 50% or more of the voting power of the outstanding securities of each of (A) the continuing or surviving entity and (B) any direct or indirect parent corporation of such continuing or surviving entity; or the sale, transfer or other disposition of all or substantially all of the Company's assets. A transaction shall not constitute a Corporate Transaction if its sole purpose is to change the state of the Company's incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company's securities immediately before such transaction. (h) "Eligible Person" shall mean a person eligible to be granted Options pursuant to Paragraph 5 hereof or Stock Purchase Rights pursuant to Paragraph 21 hereof. (i) "Employee" shall mean any person, including an officer or director, who is an employee (within the meaning of Section 422 of the Code) of the Company, any Parent, any Subsidiary or any Successor Corporation to any of the foregoing. (j) "Incentive Option" shall mean an incentive stock option as defined in Section 422(b) of the Code. (k) "Non-Statutory Option" shall mean an option which does not qualify as an Incentive Option. (l) "Option" shall mean a stock option granted pursuant to the Plan, whether an Incentive Option or a Non-Statutory Option. (m) "Option Agreement" shall mean an agreement evidencing an Option. (n) "Option Grant Date" shall mean the date on which an Option is granted by the Board. - 1 - (o) "Option Period" shall mean the period in which an Option may be exercised, to be established by the Board, subject to Paragraph 7 hereof. (p) "Option Price" shall mean the per share price of Shares (as hereinafter defined) to be issued pursuant to an Option, as determined by the Board subject to Paragraph 8 hereof. (q) "Optioned Stock" shall mean the Common Stock subject to an Option granted pursuant to the Plan. (r) "Optionee" shall mean an Eligible Person who receives an Option. (s) "Outside Director" shall mean a member of the Board of Directors who is not an Employee. (t) "Parent" shall mean a "parent corporation" as defined in Section 424(e) of the Code. (u) "Plan" shall mean this IC Global Services, Inc. 1998 Stock Plan. (v) "Predecessor Corporation" shall mean a corporation which is a party to a transaction described in Code Section 424(a) (or which would be so described if a substitution or assumption under such section had been effected) with the Company, a Parent, a Subsidiary or a predecessor corporation of any such corporations. (w) "Purchaser" shall mean a person to whom the Board has offered the right to acquire Shares under the Plan (other than upon exercise of an Option). (x) "Purchase Price" shall mean the consideration for which one Share may be acquired under the Plan (other than upon exercise of an Option), as specified by the Board. (y) "Service" shall mean service as an Employee, Outside Director or Consultant. (z) "Share" shall mean a share of Common Stock, as adjusted in accordance with Paragraph 13 of this Plan. (aa) "Stock Issuance Agreement" shall mean the agreement between the Company and a Purchaser who acquires Shares under the Plan (other than upon exercise of an Option) that contains the terms, conditions and restrictions pertaining to the acquisition of such Shares. (bb) "Stock Purchase Agreement" shall mean an agreement that is to be executed as a condition of purchasing Optioned Stock upon exercise of an Option as provided in this Plan. (cc) "Stock Purchase Right" shall mean the right to purchase Shares pursuant to Paragraph 21. (dd) "Subsidiary" shall mean a subsidiary corporation as defined in Section 424(f) of the Code. (ee) "Successor Corporation" shall mean the corporation which acquires the outstanding stock or assets of the Company in a Corporate Transaction. 3. Administration of Plan. (a) Procedure. The Plan shall be administered by the Board. The Board may appoint a Committee consisting of not less than two (2) members of the Board to administer the Plan on behalf of the Board, subject to such terms and conditions as the Board may prescribe. Once appointed, the Committee shall continue to serve until otherwise directed by the Board. From time to time, the Board may increase the size of the Committee and appoint additional members thereof, remove members (with or without cause) and appoint new members in - 2 - substitution therefor, fill vacancies, however caused, and remove all members of the Committee, and thereafter, directly administer the Plan. Any references herein to the Board shall refer to the Committee, if one is appointed, to the extent of the Committee's authority. (b) Limitations on Members of Board. Members of the Board who either are eligible for Options or have been granted Options may vote on any matters affecting the administration of the Plan or the grant of any Options pursuant to the Plan, except that no such member shall act in connection with an Option granted to himself or herself, but any such member may be counted in determining the existence of a quorum at any meeting of the Board during which action is taken with respect to Options of such member. (c) Powers of the Board. Subject to the provisions of the Plan, the Board shall have the authority, in its discretion, to make all determinations necessary or advisable for the administration of the Plan including, without limitation: (i) to determine, upon review of relevant information, the then fair market value per Share of Common Stock so long as the Common Stock is neither listed nor admitted to trading on any stock exchange nor traded in the over-the-counter market. (ii) to determine the Option Price of the Options or Purchase Price of Stock Purchase Rights to be granted, subject to the provisions of Paragraph 8 of this Plan; (iii) to determine the Eligible Persons to whom, and the time or times at which, Options or Stock Purchase Rights shall be granted, and the size of each such grant; (iv) to determine whether Options granted hereunder shall be Incentive Options or Non-Statutory Options; (v) to prescribe, amend and rescind rules and regulations relating to the Plan; (vi) to determine the terms and provisions of each Option or Stock Purchase Right granted under the Plan, which terms and conditions need not be identical, and to modify or amend each Option or Stock Purchase Right, with consent of the Optionee or Purchaser; (vii) to construe and interpret the Plan, the Option Agreements, the Stock Purchase Agreements, and any other agreement provided for hereunder; and (viii) to authorize any person to execute on behalf of the Company any instrument required to effectuate the grant of an Option or Stock Purchase Right previously granted by the Board or to take such other actions as may be necessary or advisable with respect to the Company's rights pursuant to the Option, Stock Purchase Right, Option Agreement, Stock Purchase Agreement, Stock Issuance Agreement or any other agreement approved hereunder. (d) Effect of the Board's or Committee's Decision. All decisions, determinations and interpretations of the Board, or the Committee at the direction of the Board, regarding the Plan shall be final and binding on all Optionees and Purchasers and any other holders of Shares issued under the Plan. 4. Stock Subject to the Plan. Subject to the provisions of Paragraph 13 of the Plan, the maximum aggregate number of Shares which may be issued under the Plan is One Million Eight Hundred Ninety-Nine Thousand Seven Hundred Twenty-Nine (1,899,729) Shares. This constitutes an absolute cumulative limitation on the total number of Shares that may be optioned or granted under a Stock Purchase Right under the Plan and, - 3 - therefore, at any particular date the maximum aggregate number of Shares which may be optioned or granted under a Stock Purchase Right under the Plan is equal to Two Hundred Fifty Thousand (250,000) Shares minus the number of Shares previously optioned under the Plan and Shares that were issued under the exercise of an Option or Stock Purchase Right. Shares that are not purchased by the Optionee prior to the expiration of the applicable Option Period or Shares that are issued and subsequently repurchased by the Company pursuant to the Buy-Sell Provisions or otherwise shall again become available to be covered by Options or Stock Purchase Rights to be issued hereunder and shall not, as of the effective date of such expiration, be counted as having been previously optioned or issued for purposes of the above-described maximum number of Shares which may be issued hereunder. 5. Eligibility. Options and Stock Purchase Rights may be granted to any Employee, Outside Director or Consultant who is designated by the Board in its discretion. Only Employees may be granted Incentive Options. Employees, Outside Directors and Consultants may be granted Non-Statutory Options and Stock Purchase Rights. 6. Term of the Plan. The Plan shall become effective immediately upon the earlier to occur of its adoption by the Board or its approval by vote of a majority of the outstanding Shares of the Company entitled to vote on the adoption of such Plan. The Plan shall continue in effect until ten (10) years from its respective date of establishment unless sooner terminated under Paragraphs 13, 14 or 18 of this Plan. No Option or Stock Purchase Right may be granted under the Plan after its expiration. 7. Option Agreement and Option Period. Each Option granted pursuant to the Plan shall be evidenced by an Option Agreement. Unless otherwise expressly provided in this Plan, each Option shall expire and all rights thereunder shall cease to exist at the expiration of the Option Period which shall in no event be more than ten (10) years after the Option Grant Date as fixed by the Board, subject in all cases to earlier expiration as provided in Paragraph 11 of this Plan, Notwithstanding the foregoing, the term of each Incentive Option granted to an Employee who, at the time the Incentive Option is granted, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary (determined as required by the Code as applied to Incentive Options) shall not be more than five (5) years from the Option Grant Date. 8. Price and Consideration. (a) Price. The per Share Option Price and the per share Purchase Price for the Shares to be issued under the Plan shall be such price as is determined by the Board but shall be subject to the following: (i) with respect to Incentive Options: (A) the Option Price shall in no event be less than one hundred percent (100%) of the fair market value per Share of the Company's Common Stock on the Option Grant Date, as determined by the Board; and (B) granted to an Employee who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent, Subsidiary or Predecessor Corporation (determined as required by the Code as applied to Incentive Options), the Option Price shall be at least one hundred ten percent (110%) of the fair market value per Share of the Company's Common Stock as of the Option Grant Date, as determined by the Board; (ii) with respect to Non-Statutory Options and Stock Purchase Rights: (A) the Option Price and Purchase Price shall in no event be less than eighty-five percent (85%) of the fair market value per Share of the Company's Common Stock on the Option Grant Date or the date on which the Stock Purchase Right is granted, as determined by the Board; and (B) granted to an Optionee or Purchaser who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the total combined voting power of all classes of Stock of the Company or any Parent, Subsidiary or Predecessor Corporation, the Option Price shall be at least one - 4 - hundred ten percent (110%) and the Purchase Price shall be at least one hundred percent (100%) of the fair market value per Share of the Company's Common Stock on the Option Grant Date or the date on which the Stock Purchase Right is granted, as determined by the Board. (b) Fair Market Value. As provided herein, the "fair market value" shall be determined by the Board; provided, however, that where there is a public market for the Common Stock, the fair market value per Share shall be the mean of the bid and asked prices (or the closing price per share if the Common Stock is listed on the National Association of Securities Dealers Automated Quotation National Market System of the Common Stock for the date of grant, as reported in the Wall Street Journal (or, if not so reported, as otherwise reported by the Nasdaq System) or, in the event the Common Stock is listed on a stock exchange, the fair market value per Share shall be the closing price on such exchange on the date of grant of the Option or Stock Purchase Right, as reported in the Wall Street Journal. (c) Form of Consideration. The form of consideration to be paid for the Shares to be issued upon exercise of an Option or Stock Purchase Right, including the method of payment, shall be determined by the Board and may consist of cash, check, money order, promissory notes, Service previously rendered or the surrender of Shares having a fair market value on the date of surrender equal to the purchase price of the Shares, a combination thereof, or such other consideration and method of payment for the issuance of Shares as is permitted under applicable law. (d) Promissory Notes. If the consideration for the Option Price or Purchase Price is a promissory note, such note shall be a full recourse promissory note executed by the Optionee or Purchaser. If a promissory note is given as consideration, the Company may retain the Shares purchased upon exercise of the Option or Stock Purchase Right in escrow as security for payment of the amount due under the promissory note. The par value of the Shares, if newly issued, shall be paid in cash or cash equivalents. The interest rate payable under the terms of the promissory note shall not be less than the minimum rate (if any) required to avoid the imputation of additional interest under the Code. Subject to the foregoing, the Board (at its sole discretion) shall specify the term, interest rate, amortization requirements (if any) and other provisions of such note. (e) Surrendered Common Stock. If the consideration for the Option Price or Purchase Price is the surrender of previously acquired and owned Shares of the Company, the Optionee or Purchaser will be required to make representations and warranties satisfactory to the Company regarding the Optionee's or Purchaser's title to the Shares used to effect the purchase including, without limitation, representations and warranties that the Optionee or Purchaser has good and marketable title to such Shares free and clear of any and all liens, encumbrances, charges, equities, claims, security interests, options or restrictions and has full power to deliver such Shares without obtaining the consent or approval of any person or governmental authority other than those which have already given consent or approval in a form satisfactory to the Company. The value of the Shares used to effect the purchase shall be the fair market value of those Shares as determined by the Board. (f) Exercise/Sale. To the extent that an Option Agreement so provides, and if the Shares are publicly traded, payment may be made all or in part by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Shares and to deliver all or part of the sales proceeds to the Company in payment of all or part of the Option Price and any withholding taxes. (g) Exercise/Pledge. To the extent that an Option Agreement so provides, and if the Shares are publicly traded, payment may be made all or in part by the delivery (on a form prescribed by the Company) of an irrevocable direction to pledge Shares to a securities broker or lender approved by the Company, as security for a loan, and to deliver all or part of the loan proceeds to the Company in payment of all or part of the Option Price and any withholding taxes. 9. Limit on Value of Incentive Options. The aggregate fair market value (determined as of the Option Grant Date of each Option) of the Shares with respect to which Incentive Options are exercisable for the first time by the Optionee during any calendar year shall not exceed One Hundred Thousand Dollars ($100,000), as determined pursuant to Section 422(d)(3) of the Code. 10. Exercise of Option. - 5 - (a) General Terms. Any Option granted hereunder shall be exercisable at such times and under such conditions as may be determined by the Board, which conditions may include, without limitation, performance criteria with respect to the Company and/or the Optionee or provisions for vesting over a period of time conditioned upon continued Service. In all events, in order to exercise an Option hereunder the Optionee shall execute a Stock Purchase Agreement and shall deliver the required (or permitted) consideration to the Company. As a condition to the exercise of an Option, the Board may require the Optionee pursuant to the Option Agreement to agree to restrictions on the sale or other transfer of ownership of the Common Stock acquired by an Optionee or to sell such Shares to the Company upon termination of Service. In the case of an Optionee who is not an officer of the Company, an Outside Director or a Consultant, an Option shall become exercisable at least as rapidly as 20% per year over the five-year period commencing on the Grant Date. Subject to the preceding sentence, the exercisability provisions of any Option Agreement shall be determined by the Board at its sole discretion. (b) Survival of Options. Once an Option is granted, it may not be terminated or cancelled prior to expiration of the Option Period set forth in the Option Agreement; provided, however, that (i) an Option will terminate upon termination of the Optionee's Eligible Person status as provided in the Option Agreement pursuant to Paragraph 11 of this Plan; (ii) in no event shall the Option term exceed 120 months from the Option Grant Date; and (iii) the occurrence of a merger, reorganization. sale or other event as described in Paragraph 13(b) of this Plan may result in termination of the Plan and Options issued in accordance with the terms of Paragraph 13(b). (c) Partial Exercise. An Option may be exercised from time to time during the term of the Option in accordance with the provisions of the Plan as to all or any portion of the Shares then exercisable under an Option. An Option may not be exercised for a fraction of a Share. (d) Time of Exercise. An Option shall be deemed to be exercised when the Company has received at its principal business office: (i) written notice of such exercise in accordance with the terms of the applicable Option Agreement and given by the person entitled to exercise the Option; (ii) full payment for the Shares with respect to which the Option is exercised; (iii) the executed Stock Purchase Agreement; and (iv) any other representations or agreements required by the terms of this Plan or the Option Agreement. Full payment may consist of such consideration as is authorized by the Board as provided hereunder. (e) No Rights as Stockholder Until Exercise. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the stock certificate evidencing such Shares for which the Option is exercised, no right to receive dividends or any other rights as a stockholder shall exist with respect to the Optioned Stock. No adjustment will be made for a dividend or other right for which the record date is prior to the date of issuance of the stock certificate evidencing the shares for which the Option is exercised, except as provided in Paragraph 13 of this Plan. (f) Issuance of Share Certificates. As soon as practicable after any proper exercise of an Option in accordance with the provisions of this Plan and payment in full for the exercised Shares, the Company shall deliver to the Optionee at the principal business office of the Company, or such other place as shall be mutually acceptable, a certificate or certificates representing the Shares of Common Stock as to which the Option has been exercised, The time of issuance and delivery of the certificate(s) representing the Shares of Common Stock may be postponed by the Company for such period as may be required for it, with reasonable diligence, to comply with any applicable listing requirements of any national or regional securities exchange and any law or regulation applicable to the issuance and delivery of such Shares. (g) Reduction of Shares Upon Exercise. Exercise of an Option in any manner shall result in a decrease in the number of Shares which thereafter may be available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. 11. Termination of Employment; Death or Disability. (a) General. If an Optionee ceases to be an Eligible Person then, except as provided in this Paragraph 11(a) or Paragraph 11(b) hereof, any Option of the Optionee issued under the Plan, whether vested or non-vested, shall terminate upon the terms set forth in the Option Agreement between the Company and such Eligible Person. Unless such Option Agreement provides otherwise, however, upon termination of the Optionee's - 6 - Eligible Person status, any Option of the Optionee may be exercised no later than the earlier of (i) thirty (30) days following the date of termination of Eligible Person status; or (ii) the time such Option expires by its terms, to the extent the Option was vested and exercisable on the date of termination of Eligible Person status. (b) Death or Disability. If an Optionee dies or becomes disabled, the Optionee or such person or persons to whom the Optionee's rights under the Option shall pass by the Optionee's will or by the laws of descent and distribution, may exercise the Option to the extent it was vested and exercisable on the date of death or disability no later than the earlier of (i) six (6) months following the date of such death or disability; or (ii) the time the Option expires by its terms. (c) Definition of Termination. For purposes of the Plan, except as provided in Paragraph 11(b) hereof, an Employee shall be deemed terminated as an Eligible Person when such Employee's employment is deemed to no longer continue within the meaning of Code Section 422 and the rules and regulations thereunder. An Eligible Person who is not an Employee shall be deemed terminated when such person no longer provides Service. 12. Non-Transferability of Options. The Options and any rights and privileges granted under any Option Agreement are not transferable by the Optionee, either voluntarily or by operation of law, other than by will and the laws of descent and distribution and shall be exercisable during Optionee's lifetime only by Optionee. 13. Adjustments Upon Changes in Capitalization. (a) Reorganizations, Recapitalizations, Etc. If the outstanding Shares of the Company are increased, decreased, changed into or exchanged for a different number or kind of Shares of securities of the Company through reorganization, recapitalization, reclassification, stock dividend (but only on Common Stock), stock split, reverse stock split or other similar transaction, or, if any other increase or decrease occurs in the number of Shares of the Company without the receipt of consideration by the Company, then an appropriate and proportional adjustment shall be made in: (i) the number and kind of Shares covered by each outstanding Option; (ii) the number and kind of Shares available for future grant of Options or Stock Purchase Rights; and (iii) the exercise price per Share of Stock covered by each such outstanding Option. The granting of stock options or bonuses to Eligible Persons and the conversion of any convertible securities of the Company shall not be deemed to have been "effected without the receipt of consideration" for the purposes of this Paragraph 13. Any new Shares that are made available or issued as a result of the appropriate adjustments under this Paragraph (a) shall immediately become subject to the terms and restrictions of the Plan, and Stock Option Agreement, Stock Purchase Agreement (including the Buy-Sell Provision) and the Stock Issuance Agreement, as applicable. Furthermore, and notwithstanding the foregoing, no adjustment need be made under this Paragraph 13 if, upon the advice of counsel, the Board determines that such adjustment may result in federal taxable income to the holders of Options or Common Stock or other classes of the Company's securities. (b) Corporate Transactions. Unless the applicable Stock Option Agreement provides otherwise, in the event of a Corporate Transaction that occurs before the Optionee's Service terminates, the Options may be assumed or comparable options or awards substituted by the Successor Corporation, or a parent or subsidiary thereof. The determination of option or award comparability shall be made by the Board, and its determination shall be final, binding and conclusive. In the event that such Successor Corporation refuses to assume all Options on to substitute the Options with comparable options, the Options shall become fully vested and exercisable immediately before the closing of the Corporate Transaction. In any event, if the Options are not assumed or substituted and were not exercised prior to the closing of the Corporate Transaction, the Options will then terminate and cease to be exercisable on the closing date of the Corporate Transaction. For purposes of this Paragraph, an Option granted under the Plan shall be deemed to be assumed if, following a sale of assets or merger, the Option confers the right to purchase, for each Share of Optioned Stock subject to the Option immediately prior to such sale of assets or merger, the consideration (whether stock, cash or other securities or property) received in the sale of assets or merger by holders of Common Stock for each Share held on the effective date of the Corporate transaction (and, if such holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the sale of assets or merger was not solely Common Stock of the Successor Corporation or its parent or subsidiary, the Board may, with the consent of the Successor Corporation and the Optionee, provide for the per share consideration to be - 7 - received upon exercise of the Option to be solely Common Stock of the Successor Corporation or its parent or subsidiary equal in fair market value (determined as set forth in Section 8(b) hereof) to the per share consideration received by holders of Common Stock in the sale of assets or merger. The Company can give no assurance that any Options will be assumed or comparable options substituted by the Successor Corporation or its parent or subsidiary. (c) No Fractional Shares. No fractional Shares shall be issuable on account of any action or occurrence under this Paragraph 13, and the aggregate number of Shares into which Shares then covered by an Option, when changed as the result of such action or occurrence, shall be reduced to the largest number of whole Shares resulting from such action. (d) Binding Effect of Board Determinations. All adjustments under this Paragraph 13 shall be made by the Board, whose determination in that respect shall be final and binding. (e) No Other Adjustments. Except as expressly provided herein, no issue by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to the Plan or any Options. 14. Amendment and Termination of the Plan. (a) Amendment and Termination, The Board may at any time and from time to time suspend or terminate the Plan. The Board may also amend or revise the Plan from time to time in such respects as the Board may deem advisable, but any suspension, termination or revision of the Plan shall not affect the terms of any Option or Stock Purchase Right previously granted under the Plan, unless such suspension, termination on revision is pursuant to Paragraph 13(b) of this Plan. Furthermore, without approval of the holders of the majority of the outstanding Shares of the Company's Common Stock, no such revision or amendment by the Board shall amend the Plan so as to: (i) Increase the number of Shares subject to the Plan other than in connection with an adjustment under Paragraph 13 of this Plan; or (ii) Extend the term of the Plan beyond that provided in Paragraph 6 hereof. If required by applicable law, stockholder approval shall be obtained of any amendments to the Plan. (b) Effect of Termination. Except as otherwise provided in Paragraph 13 hereof, without the written consent of the Optionee, any such termination of the Plan pursuant to this Paragraph 14 shall not affect Options or Stock Purchase Rights already granted and such Options or Stock Purchase Rights shall remain in full force and effect as if the Plan had not been terminated. 15. Conditions Upon Issuance of Shares. Options and Stock Purchase Rights granted under the Plan are conditioned upon the Company obtaining any required permit, if any, from appropriate governmental agencies, authorizing the Company to grant such Options and Stock Purchase Rights upon terms and conditions acceptable to the Company. Shares shall not be issued with respect to an Option or Stock Purchase Right granted under the Plan unless the exercise of such Option or Stock Purchase Right and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder by the United States government, the requirements of any stock exchange upon which the Shares may then be listed, and any applicable state laws and regulations and shall be further subject to the approval of counsel for the Company with respect to such compliance. As a condition to the exercise of an Option or a Stock Purchase Right, the Board may require the person exercising such Option or Stock Purchase Right to execute any agreements approved by the Board, and may require the person exercising such Option or Stock Purchase Right to make any representation and warranty to the Company as may, in the judgment of counsel to the Company, be required under applicable laws or regulations. - 8 - 16. Reservation of Shares. During the term of the Plan, the Company will at all times reserve and keep available the number of Shares as shall be sufficient to satisfy the requirements of the Plan. During the term of the Plan, the Company will use its best efforts to seek to obtain from appropriate regulatory agencies any requisite authorization in order to issue and sell such number of Shares as shall be sufficient to satisfy the requirements of the Plan. The inability of the Company to obtain from any such regulatory agency the requisite authorization(s) deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Shares hereunder, or the inability of the Company to confirm to its satisfaction that any issuance and sale of any Shares hereunder will meet applicable legal requirements, shall relieve the Company of any liability in respect to the non-issuance or sale of such Shares as to which such requisite authority shall not have been obtained. 17. Taxes and Withholding of Taxes. The grant of Options hereunder and the issuance of Shares pursuant to the exercise of such Options on Stock Purchase Rights are conditioned upon the Company reservation of the right to withhold, in accordance with any applicable law, from any compensation payable to the Optionee or Purchaser any taxes required to be withheld by federal, state, local or foreign law as a result of the grant or exercise of such Options or Stock Purchase Rights. 18. Stockholder Approval of the Plan. Continuance of the Plan shall be subject to approval by the holders of the outstanding voting stock of the Company in accordance with applicable law within twelve (12) months before or after the date the Plan is adopted by the Board. Any Options granted under the Plan prior to obtaining such stockholder approval shall be granted upon the conditions that the Options so granted: (a) shall not be exercisable prior to such approval; and (b) shall become null and void ab initio if such stockholder approval is not obtained. 19. Liability of Company. The Company, its Parent or any Subsidiary, in existence or which hereafter comes into existence, will not be liable to an Optionee granted an Incentive Option or other person if it is determined for any reason by the Internal Revenue Service or any court having jurisdiction that any Incentive Options granted hereunder are not incentive stock options under the Code. 20. Notices. Any notice to be given to the Company pursuant to the provisions of the Plan shall be delivered personally and addressed to the Company at its principal office and any notice to be given to an Optionee or Purchaser shall be delivered personally or addressed to such Optionee or Purchaser at the address last given to the Company by such Optionee or Purchaser in writing. Any notice under this Agreement shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, registered or certified, and deposited, postage and registry or certification fee prepaid, in a post office, branch post office on mailbox regularly maintained by the United States Postal Service. It shall be the obligation of each Optionee and Purchaser and each transferee holding Shares to give written notice of such person's direct mailing address to the Company. 21. Terms and Conditions of Stock Purchase Rights. (a) Stock Issuance Agreement. Each award or sale of Shares under the Plan (other than upon exercise of an Option) shall be evidenced by a Stock Issuance Agreement between the Purchaser and the Company. Such award or sale shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent with the Plan and which the Board deems appropriate for inclusion in a Stock Issuance Agreement. The provisions of the various Stock Issuance Agreements entered into under the Plan need not be identical. (b) Duration of Offers and Nontransferability of Rights. Any right to acquire Shares under the Plan (other than an Option) shall automatically expire if not exercised by the Purchaser within 30 days after the grant of such right was communicated to the Purchaser by the Company. Such right shall not be transferable and shall be exercisable only by the Purchaser to whom such right was granted. (c) Purchase Price. The Purchase Price of Shares to be offered under the Plan and the form of payment are described in Paragraph 8. - 9 - (d) Withholding Taxes. As a condition to the exercise of the Stock Purchase Right and the purchase of Shares, the Purchaser shall make such arrangements as the Board may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such purchase. (e) Restrictions on Transfer of Shares and Minimum Vesting. Any Shares awarded or sold under the Plan shall be subject to such special forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Board may determine. Such restrictions shall be set forth in the applicable Stock Issuance Agreement and shall apply in addition to any restrictions that may apply to holders of Shares generally. In the case of a Purchaser who is not an officer of the Company, an Outside Director or a Consultant, any right to repurchase the Purchaser's Shares at the original Purchase Price (if any) upon termination of the Purchaser's Service shall lapse at least as rapidly as 20% per year over the five-year period commencing on the date of the award or sale of the Shares. Any such right may be exercised only within 90 days after the termination of the Purchaser's Service for cash or for cancellation of indebtedness incurred in purchasing the Shares. (f) Accelerated Vesting. Unless the applicable Stock Issuance Agreement provides otherwise, any right to repurchase a Purchaser's unvested Shares at the original Purchase Price (if any) upon termination of the Purchaser's Service shall lapse and all of such Shares shall become vested if (i) the Company is subject to a Corporate Transaction before the Purchaser's Service terminates and (ii) the repurchase right is not assigned to the Successor Corporation or to its parent or subsidiary. 22. No Enlargement of Service Rights. The establishment and maintenance of the Plan is purely voluntary on the part of the Company, and the continuance of the Plan shall not be deemed to constitute a contract between the Company and any Optionee or Purchaser, or to be consideration for or a condition of the Service of any Optionee or Purchaser. Nothing contained in the Plan shall be deemed to give any Optionee or Purchaser the right to be retained in the Service of the Company, its Parent, Subsidiary or a Successor Corporation, or to interfere with the right of the Company or any such corporations to discharge or retire any Optionee or Purchaser at any time for any reason, with or without cause. 23. Legends on Certificates. (a) Federal Law, All certificates evidencing Shares issued under the Plan shall bear the following legend: "THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF WRITTEN AGREEMENTS BETWEEN THE COMPANY AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE SHARES). SUCH AGREEMENTS GRANT TO THE COMPANY CERTAIN RIGHTS OF FIRST REFUSAL UPON AN ATTEMPTED TRANSFER OF THE SHARES AND CERTAIN REPURCHASE RIGHTS UPON TERMINATION OF SERVICE WITH THE COMPANY. THE SECRETARY OF THE COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENTS TO THE HOLDER HEREOF WITHOUT CHARGE." All certificates evidencing Shares in an unregistered transaction shall bear the following legend (and such other restrictive legends as are required or deemed advisable under the provisions of any applicable law): "THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED." - 10 - (b) State Legend. If required by applicable state authorities, each certificate representing the Options and Shares issuable under the Plan shall be endorsed on its face with any legends required by such authorities. 24. Invalid Provisions. In the event that any provision of the Plan is found to be invalid or otherwise unenforceable under any applicable law, such invalidity or unenforceability shall not be construed as rendering any other provisions contained herein as invalid or unenforceable, and all such other provisions shall be given full force and effect to the same extent as though the invalid or unenforceable provision was not contained herein. 25. Financial Reports. The Company each year shall furnish to Optionees, Purchasers and stockholders who have received Shares under the Plan its balance sheet and income statement, unless such Optionees, Purchasers or stockholders are key Employees whose duties with the Company assure them access to equivalent information. Such balance sheet and income statement need not be audited. 26. Modification, Extension and Assumption of Options. Within the limitations of the Plan, the Board may modify, extend or assume outstanding Options or may accept the cancellation of outstanding Options (whether granted by the Company or another issuer) in return for the grant of new Options for the same or a different number of Shares and at the same or a different Option Price. The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, impair the Optionee's rights or increase the Optionee's obligations under such Option. In connection with a corporate reorganization, merger, consolidation, acquisition or similar event, the Board may also assume or substitute outstanding options granted by the Company or by another issuer for options granted under the Plan, in compliance with Section 424 of the Code. 27. Repurchase of Vested Shares, In the event that the Company elects to repurchase any vested Shares upon a termination of Service, the Company shall pay to the Optionee (or Purchaser) the higher of the Option Price (or Purchase Price) and the fair market value of such Shares on the date this Company exercises its repurchase right. Such repurchase right shall be exercised within sixty (60) days after termination of Service. 28. Governing Law. The Plan shall be governed and construed in accordance with the laws of Delaware (except for its choice-of-law provisions). - 11 - EX-4.6 4 ex-4_6.txt EXHIBIT 4-6 EXHIBIT 4.6 INTERNATIONAL LANGUAGE ENGINEERING CORPORATION AMENDED AND RESTATED 1997 STOCK OPTION PLAN ADOPTED MARCH 31, 1997; AMENDED JUNE 22, 1997 APPROVED BY SHAREHOLDERS JUNE 22, 1997 1. PURPOSES. (a) The purpose of the Plan is to provide a means by which selected Employees and Directors of the Company, and its Subsidiaries, may be given an opportunity to purchase stock of the Company. (b) The Company, by means of the Plan, seeks to retain the services of persons who are now Employees or Directors of the Company or its Subsidiaries, to secure and retain the services of new Employees and Directors, and to provide incentives for such persons to exert maximum efforts for the success of the Company and its Subsidiaries. (c) The Company intends that the Options issued under the Plan shall, in the discretion of the Board or any Committee to which responsibility for administration of the Plan has been delegated pursuant to subsection 3(c), be either Incentive Stock Options or Nonstatutory Stock Options. All Options shall be separately designated Incentive Stock Options or Nonstatutory Stock Options at the time of grant, and in such form as issued pursuant to Section 6, and a separate certificate or certificates will be issued for shares purchased on exercise of each type of Option. 2. DEFINITIONS. (a) "Board" means the Board of Directors of the Company. (b) "Code" means the Internal Revenue Code of 1986, as amended. 1. (c) "Committee" means a Committee appointed by the Board in accordance with subsection 3(c) of the Plan. (d) "Company" means International Language Engineering Corporation, a Colorado corporation. (e) "Consultant" means any person, including an advisor, engaged by the Company or an Affiliate to render consulting services and who is compensated for such services, provided that the term "Consultant" shall not include Directors who are paid only a director's fee by the Company or who are not compensated by the Company for their services as Directors, (f) "Continuous Status as an Employee, Director or Consultant" means that the service of an individual to the Company, whether as an Employee, Director or Consultant, is not interrupted or terminated. The Board, in its sole discretion, may determine whether Continuous Status as an Employee, Director or Consultant shall be considered interrupted in the case of: (i) any leave of absence approved by the Board, including sick leave, military leave, or any other personal leave; or (ii) transfers between the Company, Subsidiaries or their successors. (g) "Director" means a member of the Board. (h) "Employee" means any person, including Officers and Directors, employed by the Company or any Affiliate of the Company. Neither service as a Director nor payment of a director's fee by the Company shall be sufficient to constitute "employment" by the Company. (i) "Exchange Act" means the Securities Exchange Act of 1934, as amended. (j) "Fair Market Value" means, as of any date, the price per share as quoted on any public exchange, or if the common stock of the Company is not publicly treaded the value of the common stock of the Company determined in good faith by the Board. 2. (k) "Incentive Stock Option" means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder. (l) "Nonstatutory Stock Option" means an Option not intended to qualify as an Incentive Stock Option. (m) "Option" means a stock option granted pursuant to the Plan. (n) "Option Agreement" means a written agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. Each Option Agreement shall be subject to the terms and conditions of the Plan. (o) "Optionee" means an Employee or Director who holds an outstanding Option. (p) "Plan" means this 1997 Stock Option Plan. (q) "Subsidiary" means any subsidiary corporation, whether now or hereafter existing, as such term is defined in Section 424 of the Code. 3. ADMINISTRATION. (a) The Plan shall be administered by the Board unless and until the Board delegates administration to a Committee, as provided in subsection 3(c). (b) The Board shall have the power, subject to, and within the limitations of, the express provisions of the Plan: (1) To determine from time to time which of the persons eligible under the Plan shall be granted Options; when and how each Option shall be granted; whether an Option will be an Incentive Stock Option or a Nonstatutory Stock Option; the provisions of each Option granted, including the time or times such Option may be exercised in whole or in part; and the number of shares for which an Option shall be granted to each such person. (2) To construe and interpret the Plan and Options granted under it, and to establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or in any Option 3. Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective. (3) To amend the Plan or an Option as provided in Section 11. (4) Generally, to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best interests of the Company which are not in conflict with the provisions of the Plan. (c) The Board may delegate administration of the Plan to any person or persons (the "Committee"). If administration is delegated to a Committee, the Committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by Board (and references in this Plan to the Board shall thereafter be to the Committee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan. 4. SHARES SUBJECT TO THE PLAN. (a) Subject to the provisions of Section 10 relating to adjustments upon changes in stock, the stock that may be sold pursuant to Options shall not exceed in the aggregate eight hundred forty thousand six hundred seventy eight (840,678) shares of the Company's common stock. If any Option shall for any reason expire or otherwise terminate, in whole or in part, without having been exercised in full, the stock not purchased under such Option shall revert to and again become available for issuance under the Plan. (b) The stock subject to the Plan may be unissued shares or reacquired shares, bought on the market or otherwise. 4. 5. ELIGIBILITY. (a) Incentive Stock Options may be granted only to Employees. Nonstatutory Stock Options may be granted only to Employees or Directors. (b) No person shall be eligible for the grant of an Incentive Stock Option if, at the time of grant, such person owns (or is deemed to own pursuant to Section 424(d) of the Code) stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or of any of its Subsidiaries unless the exercise price of such Incentive Stock Option is at least one hundred ten percent (110%) of the Fair Market Value of such stock at the date of grant and the Incentive Stock Option is not exercisable after the expiration of five (5) years from the date of grant. 6. OPTION PROVISIONS. Each Option shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The provisions of separate Options need not be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance of each of the following provisions: (a) Term. No Option shall be exercisable after the expiration often (10) years from the date it was granted. (b) Price. The exercise price of each Incentive Stock Option shall be not less than one hundred percent (100%) of the Fair Market Value of the stock subject to the Incentive Stock Option on the date the Incentive Stock Option is granted. The exercise price of each Nonstatutory Stock Option shall be determined by the Board. Notwithstanding the foregoing, the Board may grant an Option with an exercise price lower than that set forth above if such Option is granted as part of a transaction to which section 424(a) of the Code applies. 5. (c) Consideration. The purchase price of stock acquired pursuant to an Option shall be paid to the extent permitted by applicable statutes and regulations, either (i) in cash at the time the Option is exercised, or (ii) at the discretion of the Board or the Committee, at the time of the grant of the Option, by delivery to the Company of other common stock of the Company or in any other form of legal consideration that may be acceptable to the Board. In the case of any deferred payment arrangement, interest shall be payable at least annually and shall be charged at the minimum rate of interest necessary to avoid the treatment as interest, under any applicable provisions of the Code, of any amounts other than amounts stated to be interest under the deferred payment arrangement. (d) Transferability. An Option shall not be transferable except by will or by the laws of descent and distribution, and shall be exercisable during the lifetime of the person to whom the Option is granted only by such person. The person to whom the Option is granted may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of the Optionee, shall thereafter be entitled to exercise the Option. (e) Vesting. The total number of shares of stock subject to an Option may, but need not be allocated in periodic installments (which may, but need not, be equal). The Option Agreement may provide that from time to time during each of such installment periods, the Option may become exercisable ("vest") with respect to some or all of the shares allotted to that period, and may be exercised with respect to some or all of the shares allotted to such period and/or any prior period as to which the Option became vested but was not fully exercised. The Option may be subject to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria) as the Board may deem appropriate. The provisions 6. of this subsection 6(e) are subject to any Option provisions governing the minimum number of shares as to which an Option may be exercised. (f) Securities Law Compliance. The Company may require any Optionee, or any person to whom an Option is transferred under subsection 6(d), as a condition of exercising any such Option, (1) to give written assurances satisfactory to the Company as to the Optionee's knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory to the Company who is knowledgeable and experienced in financial and business matters, and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the Option; and (2) to give written assurances satisfactory to the Company stating that such person is acquiring the stock subject to the Option for such person's own account and not with any present intention of selling or otherwise distributing the stock. The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if (i) the issuance of the shares upon the exercise of the Option has been registered under a then currently effective registration statement under the Securities Act of 1933, as amended (the "Securities Act"), or (ii) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then applicable securities laws. The Company may require the Optionee to provide such other representations, written assurances or information which the Company shall determine is necessary, desirable or appropriate to comply with applicable securities and other laws as a condition of granting an Option to such Optionee or permitting the Optionee to exercise such Option. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to comply with applicable securities laws, including, but not limited to, legends restricting the transfer 7. of the stock. (g) Termination of Employment or Relationship as a Director or Consultant. Subject to the terms of any Option Grant Agreement, in the event an Optionee's Continuous Status as an Employee, Director or Consultant terminates (other than upon the Optionee's death or disability), the Optionee may exercise his or her Option (to the extent that the Optionee was entitled to exercise it as of the date of termination) but only within such period of time ending on (i) in the case of Incentive Stock Options, the date three (3) months after the termination of the Optionee's Continuous Status as an Employee, Director or Consultant, or such longer or shorter period specified in the Option Agreement, or (ii) in the case of Nonstatutory Stock Options, the expiration date of such Option. If, after termination, the Optionee does not exercise his or her Option within the time specified above, the Option shall terminate, and the shares covered by such Option shall revert to and again become available for issuance under the Plan. Finally, an Optionee's Option Agreement may also provide that if the exercise of the Option following the termination of the Optionee's Continuous Status as an Employee, Director or Consultant (other than upon the Optionee's death or disability) would be prohibited at any time solely because the issuance of share would violate the registration requirements under the Securities Act, then the Option shall terminate on the earlier of (i) the expiration of the term of the Option set forth in the first paragraph of this Section 7, or (ii) the expiration of a period of three (3) months after the termination of the Optionee's Continuous Status as an Employee, Director or Consultant during which the exercise of the Option would not be in violation of such registration requirements. (h) Disability of Optionee. In the event an Optionee's Continuous Status as an Employee, Director or Consultant terminates as a result of the Optionee's disability, the Optionee may exercise his or her Option (to the extent that the Optionee was entitled to exercise it as of the 8. date of termination), but only within such period of time ending on the earlier of (i) in the case of Incentive Stock Options the date three (3) months following such termination (or such longer or shorter period specified in the Option Agreement), or (ii) in the case of Nonstatutory Stock Options the expiration of the term of the Option as set forth in the Option Agreement. If, at the date of termination, the Optionee is not entitled to exercise his or her entire Option, the shares covered by the unexercisable portion of the Option shall revert to and again become available for issuance under the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified herein, the Option shall terminate, and the shares covered by such Option shall revert to and again become available for issuance under the Plan. (i) Death of Optionee. In the event of the death of an Optionee during, or within a period specified in the Option Agreement after the termination of, the Optionee's Continuous Status as an Employee, Director or Consultant, the Option may be exercised (to the extent the Optionee was entitled to exercise the Option as of the date of death) by the Optionee's estate, by a person who acquired the right to exercise the Option by bequest or inheritance or by a person designated to exercise the option upon the Optionee's death pursuant to subsection 6(d), at any time before the expiration of the term of such Option as set forth in the Option Agreement. If, at the time of death, the Optionee was not entitled to exercise his or her entire Option, the shares covered by the unexercisable portion of the Option shall revert to and again become available for issuance under the Plan. If, after death, the Option is not exercised within the time specified herein, the Option shall terminate, and the shares covered by such Option shall revert to and again become available for issuance under the Plan. (j) Early Exercise. The Option may, but need not, include a provision whereby the Optionee may elect at any time while an Employee, Director or Consultant to exercise the Option 9. as to any part or all of the shares subject to the Option prior to the full vesting of the Option. Any unvested shares so purchased may be subject to a repurchase right in favor of the Company or to any other restriction the Board determines to be appropriate. (k) Right of Repurchase. The Option may, but need not, include a provision whereby the Company may elect, prior to the date of the first registration of an equity security of the Company under Section 12 of the Exchange Act, to repurchase all or any part of the vested shares exercised pursuant to the Option. (l) Right of First Refusal. The Option may, but need not, include a provision whereby the Company may elect, prior to the date of the first registration of an equity security of the Company under Section 12 of the Exchange Act, to exercise a right of first refusal following receipt, of notice from the Optionee of the intent to transfer all or any part of the shares exercised pursuant to the Option. (m) Withholding. To the extent provided by the terms of an Option Agreement, the Optionee may satisfy any federal, state or local tax withholding obligation relating to the exercise of such Option by any of the following means or by a combination of such means: (1) tendering a cash payment; (2) authorizing the Company to withhold shares from the shares of the common stock otherwise issuable to the Optionee as a result of the exercise of the Option; or (3) delivering to the Company owned and unencumbered shares of the common stock of the Company. 7. COVENANTS OF THE COMPANY. (a) During the terms of the Options, the Company shall keep available at all times the number of shares of stock required to satisfy such Options. (b) The Company shall seek to obtain from each regulatory commission or agency having jurisdiction over the Plan such authority as may be required to issue and sell shares of stock 10. upon exercise of the Options; provided, however, that this undertaking shall not require the Company to register under the Securities Act either the Plan, any Option or any stock issued or issuable pursuant to any such Option. If, after reasonable efforts, the Company is unable to obtain from any such regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of stock under the Plan, the Company shall be relieved from any liability for failure to issue and sell stock upon exercise of such Options unless and until such authority is obtained. 8. USE OF PROCEEDS FROM STOCK. Proceeds from the sale of stock pursuant to Options shall constitute general funds of the Company. 9. MISCELLANEOUS. (a) The Board shall have the power to accelerate the time at which an Option may first be exercised or the time during which an Option or any part thereof will vest pursuant to subsection 6(e), notwithstanding the provisions in the Option stating the time at which it may first be exercised or the time during which it will vest. (b) Neither an Optionee nor any person to whom an Option is transferred under subsection 6(d) shall be deemed to be the holder of, or to have any of the rights of a holder with respect to, any shares subject to such Option unless and until such person has satisfied all requirements for exercise of the Option pursuant to its terms. (c) Nothing in the Plan or any instrument executed or Option granted pursuant thereto shall confer upon any Employee, Director, Consultant or Optionee any right to continue in the employ of the Company or any Affiliate (or to continue acting as a Director or Consultant) or shall affect the right of the Company or any Affiliate to terminate the employment of any Employee with 11. or without cause, the right of the Company's Board of Directors and/or the Company's shareholders to remove any Director pursuant to the terms of the Company's shareholders to remove any Director pursuant to the terms of the Company's By-Laws and applicable law, or the right to terminate the relationship of any Consultant pursuant to the terms of such Consultant's agreement with the Company or Affiliate. (d) To the extent that the aggregate Fair Market Value (determined at the time of grant) of stock with respect to which Incentive Stock Options are exercisable for the first time by any Optionee during any calendar year under all plans of the Company and its Subsidiaries exceeds one hundred thousand dollars ($100,000), the Options or portions thereof which exceed such limit (according to the order in which they were granted) shall be treated as Nonstatutory Stock Options. (e) The Board or the Committee shall have the authority to effect, at any time and from time to time (i) the repricing of any outstanding Options under the Plan and/or (ii) with the consent of the affected holders of Options, the cancellation of any outstanding Options and the grant in substitution therefor of new Options under the Plan covering the same or different numbers of shares of common stock, but having an exercise price per share not less than one hundred percent (100%) of the Fair Market Value in the case of an Incentive Stock Option or, in the case of a ten percent (10%) shareholder (as defined in subsection 5(c)), not less than one hundred and ten percent (110%) of the Fair Market Value per share of Common Stock on the new grant date. Notwithstanding the foregoing, the Board may grant an Option with an exercise price lower than that set forth above if such Option is granted as part of a transaction to which section 424(c) of the Code applies. 12. 10. ADJUSTMENTS UPON CHANGES IN STOCK. (a) If any change is made in the stock subject to the Plan, or subject to any Option (through merger, consolidation, reorganization, reincorporation, recapitalization, stock dividend, dividend in property other than cash, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other transaction not involving the receipt of consideration by the Company), the Plan will be appropriately adjusted in the class(es) and maximum number of shares subject to the Plan pursuant to subsection 4(a), and the outstanding Options will be appropriately adjusted in the class(es) and number of shares and price per share of stock subject to such outstanding Options. Such adjustments shall be made by the Board or Committee, the determination of which shall be final, binding and conclusive. (The conversion of any convertible securities of the Company shall not be treated as a "transaction not involving the receipt of consideration by the Company.") (b) In the event of the proposed dissolution or liquidation of the Company, each outstanding Option shall terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Board. 11. AMENDMENT OF THE PLAN AND OPTIONS. (a) The Board at any time, and from time to time, may amend the Plan. However, except as provided in Section 10 relating to adjustments upon changes in stock, no amendment shall be effective unless approved by the shareholders of the Company within twelve (12) months 13. before or after the adoption of the amendment, where the amendment will modify the Plan in any other way if such modification requires shareholder approval in order for the Plan to satisfy the requirement of Section 422 of the Code (including an increase in the number of shares reserved for issuance under the Plan). (b) The Board may in its sole discretion submit any other amendment to the Plan for shareholder approval. (c) It is expressly contemplated that the Board may amend the Plan in any respect the Board deems necessary or advisable to provide Optionees with the maximum benefits provided or to be provided under the provisions of the Code and the regulations promulgated thereunder relating to Incentive Stock Options and/or to bring the Plan and/or Incentive Stock Options granted under it into compliance therewith. (d) Rights and obligations under any Option granted before amendment of the Plan shall not be impaired by any amendment of the Plan unless (i) the Company requests the consent of the person to whom the Option was granted and (ii) such person consents in writing. (e) The Board at any time, and from time to time, may amend the terms of any one or more Options; provided, however, that the rights and obligations under any Option shall not he impaired by any such amendment unless (i) the Company requests the consent of the person to whom the Option was granted and (ii) such person consents in writing. 12. TERMINATION OR SUSPENSION OF THE PLAN. (a) The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the Plan shall terminate ten (10) years from the date the Plan is adopted by the Board or approved by the shareholders of the Company, whichever is earlier. No Options may be granted under the Plan while the Plan is suspended or after it is terminated. 14. (b) Rights and obligations under any Option granted while the Plan is in effect shall not be impaired by suspension or termination of the Plan, except with the written consent of the person to whom the Option was granted. 13. EFFECTIVE DATE OF PLAN. The Plan shall become effective as determined by the Board, but no Options granted under the Plan shall be exercised unless and until the Plan has been approved by the shareholders of the Company, which approval shall be within twelve (12) months before or after the date the Plan is adopted by the Board. 15. EX-5.1 5 ex-5_1.txt EXHIBIT 5-1 EXHIBIT 5.1 Testa, Hurwitz & Thibeault, LLP 125 High Street Boston, MA 02110 June 9, 2000 Lionbridge Technologies, Inc. 950 Winter Street Waltham, MA 02451 Re: Registration Statement on Form S-8 Relating to the IC Global Services, Inc. 1998 Stock Plan (Amended and Restated April 6, 1999), the International Language Engineering Corporation Amended and Restated 1997 Stock Option Plan and the Harvard Translations, Inc. 1997 Stock Option Plan (collectively, the "Plans") Ladies and Gentlemen: We are acting as counsel for Lionbridge Technologies, Inc., a Delaware corporation (the "Company"), in connection with the registration on a Registration Statement on Form S-8 (the "Registration Statement") under the Securities Act of 1933, as amended, relating to an aggregate of 745,941 shares of Common Stock, par value $.01 per share, of the Company issuable pursuant to the Plans (the "Shares"). In rendering our opinion, we have examined, and are familiar with, and have relied as to factual matters solely upon, originals or copies certified, or otherwise identified to our satisfaction, of such documents, corporate records or other instruments as we have deemed necessary or appropriate for the purposes of the opinion set forth herein, including, without limitation, (a) the Plans, (b) the Company's Second Amended and Restated Certificate of Incorporation, (c) the Company's Amended and Restated By-laws, (d) a specimen form of the certificate evidencing the Shares, (e) the Agreement and Plan of Reorganization dated as of March 30, 2000 by and among the Company, HT Acquisition Corp., Harvard Translations, Inc. and Robert C. Sprung, (f) the Amended and Restated Agreement and Plan of Reorganization dated as of March 30, 2000 by and among the Company, LTI Acquisition Corp. and INT'L.com, Inc. and (g) the minute books and stock records of the Company. We are members only of the bar of the Commonwealth of Massachusetts and are not experts in, and express no opinion regarding, the laws of any jurisdiction other than the Commonwealth of Massachusetts, the United States of America and the Delaware General Corporation Law. Based upon and subject to the foregoing, we are of the opinion that the Shares are duly authorized and, when issued and paid for in accordance with the terms of the Plans and the terms of any agreement relating to any of the options granted thereunder, will be validly issued, fully paid and nonassessable. We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement. Very truly yours, /s/ Testa, Hurwitz & Thibeault, LLP TESTA, HURWITZ & THIBEAULT, LLP EX-23.2 6 ex-23_2.txt EXHIBIT 23.2 EXHIBIT 23.2 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of our report dated January 24, 2000 relating to the financial statements of Lionbridge Technologies, Inc., which appears in Lionbridge Technologies, Inc.'s Annual Report on Form 10-K for the year ended December 31, 1999. /s/ PricewaterhouseCoopers LLP Boston, Massachusetts June 9, 2000 -----END PRIVACY-ENHANCED MESSAGE-----