TELTECH RESOURCE NETWORK CORPORATION
1995 KEY EMPLOYEE NONQUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT, made this _____ day of ________, between TELTECH
RESOURCE NETWORK CORPORATION, a Minnesota corporation (the "Company"), and
____________, (the "Optionee");
W I T N E S S E T H :
WHEREAS, the Optionee on the date hereof is an employee, officer or
director of the Company or a Subsidiary of the Company; and
WHEREAS, to induce the Optionee to further the Optionee's efforts in
its behalf, the Company desires to grant to the Optionee an option to purchase
shares of its Common Stock;
WHEREAS, the Company's board of Directors has adopted a stock option
plan providing for the grant of nonqualified stock options known as the "Teltech
Resource Network Corporation 1995 Key Employee Nonqualified Stock Option Plan"
(hereinafter referred to as the "Plan"); and
WHEREAS, on the date hereof, the Company's Board of Directors (or, if
so appointed and empowered by the board, the Board's Stock Option Committee)
authorized the grant of this option to the Optionee;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Company and the Optionee hereby agree as
follows:
1. GRANT OF OPTION. The Company hereby grants to the Optionee, on the
date of this Agreement, the Option to purchase ________ shares of the Common
stock of the Company (the "Option Stock") subject to the terms and conditions
herein contained, and subject only to adjustment in such number of shares as
provided in Section 10 of the Plan.
2. OPTION PRICE. During the term of this option, the purchase price for
the shares of Option Stock granted herein is $ ______ per share, subject only to
adjustment of such price as provided in Section 10 of the Plan.
3. TERM OF OPTION. The term during which this option may be exercised
expires at the close of business on ________ unless terminated earlier under the
provisions of Paragraphs 10 or 11 below. This option shall be exercisable
immediately to the extent of _______ percent of the total number of shares
granted under paragraph 1 above. Thereafter this option shall be exercisable to
the extent of __________ percent of such total number of shares during each
succeeding year until the earlier of the time this option shall have become
exercisable to the extent of One Hundred Percent (100%) of the total number of
shares specified in Paragraph 1 or its expiration. If the Optionee does not
purchase in any option year the full number of shares which the Optionee is
entitled to purchase that year, the Optionee may purchase in any subsequent
option year such previously unpurchased shares in addition to those the Optionee
is otherwise entitled to purchase. If this option has been granted prior to
approval of the Plan by the Company's shareholders, this option shall not be
exercisable until such approval is obtained.
4. PERSONAL EXERCISE BY OPTIONEE. This option shall, during the
lifetime of the Optionee, be exercisable only by said Optionee and shall not be
transferable by the Optionee, in whole or in part, other than by will or by the
laws of descent and distribution.
5. MANNER OF EXERCISE OF OPTION. This option is to be exercised by the
Optionee (or by the Optionee's successor of successors) by giving written notice
to the Company of an election to exercise such option. Such notice shall specify
the number of shares to be purchased hereunder and shall specify a date (not
more than 30 calendar days and not less than 10 calendar days from the date of
delivery of the notice to the Company) on which the Optionee shall deliver
payment of the full purchase price for the shares being purchased and the
Company shall deliver
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certificates to the Optionee representing the shares so purchased. Such notice
shall be delivered to the Company at its principal place of business. An option
shall be considered exercised at the time the Company receives such notice. Upon
receipt of such notice and subject to the Provisions of Paragraph 9 below, the
Company shall, on the dates specified in such notice and against payment by the
Optionee of the required purchase price, deliver to the Optionee certificates
for the shares so purchased. Payment for shares of Option Stock may be made in
the form of cash, certified check, or such other payment method as may be
authorized by the Board of Directors. All requisite original issue or transfer
documentary stamp taxes shall be paid by the Company.
6. RIGHTS AS A SHAREHOLDER. The Optionee or a transferee of this option
shall have no rights as a shareholder with respect to any shares covered by this
option until the date of the issuance of a stock certificate for such shares,
except as provided in Section 11 of the Plan. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, securities or other
property), distributions or other rights for which the record is prior to the
date such stock certificate is issued, except as provided in Section 11 of the
Plan.
7. STOCK OPTION PLAN. The option evidenced by this Agreement is granted
pursuant to the Plan, a copy of which Plan is attached hereto or has been made
available to the Optionee and is hereby made a part of this Agreement. This
Agreement is subject to and in all respects limited and conditioned as provided
in the Plan. The Plan governs this option and the Optionee, and in the event of
any question as to the construction of this Agreement or of a conflict between
the Plan and this Agreement, the Plan shall govern, except as the Plan otherwise
provides.
8. WITHHOLDING TAXES. In order to permit the Company to receive a tax
deduction in connection with the exercise of this option, the Optionee agrees
that as a condition to any exercise of this option, the Optionee will also pay
to the Company, or make arrangements satisfactory to the Company regarding
payment of, any federal, state, local or other taxes required by law to be
withheld with respect to the option's exercise.
9. INVESTMENT PURPOSE. The Company requires as a condition to the grant
and exercise of this option that any stock acquired pursuant to this option be
acquired for only investment if, in the opinion of counsel for the Company, such
is required or deemed advisable under securities laws or any other applicable
law, regulation or rule or any government of governmental agency. In this
regard, if required by the Company, the Optionee, prior to the acquisition of
any shares pursuant to this option, shall execute an investment letter to the
effect that the Optionee is acquiring shares pursuant to the option for
investment purposes only and not with the intention of making any distribution
of such shares and will not dispose of the shares in violation of the applicable
federal and state securities laws. The optionee also agrees that, as provided in
Section 12 of the Plan, the Board or the Committee may delay the exercise of any
rights granted under the Plan to insure compliance with all legal requirements.
10. TERMINATION OF EMPLOYMENT OR DIRECTORSHIP (FOR REASONS OTHER THAN
DEATH). If the Optionee ceases to be an employee of the Company or any
Subsidiary for any reason other than because of death (as described below) or
because of the sale, merger, or liquidation of the Company (which is covered by
the provisions of Section 11 of the Plan), this option shall terminate
(notwithstanding Paragraph 3 of this Agreement), on the earlier of (i) the close
of business on the three-month anniversary date of the Optionee's termination,
and (ii) this option's originally stated expiration date. In such period
following such termination of employment or directorship, this option shall be
exercisable as provided above only to the extent the option was exercisable on
the date of termination of employment or
directorship but had not previously been exercised. In the event of a merger
with Knight Ridder Information, Inc., Section 16 of the Plan shall govern.
11. DEATH OF OPTIONEE. If the Optionee dies (1) while an employee or
director of the Company or any Subsidiary, or (2) within a period of three
months after his termination of employment or directorship with the Company or
any Subsidiary as provided in Paragraph 10, this option shall terminate
(notwithstanding Paragraph 3 of this Agreement) on the earlier of (i) the close
of business on the one-year anniversary date of the Optionee's death, and (ii)
this option's originally stated expiration date. In such period following the
Optionee's death, this option may be exercised only by the person or person to
whom the Optionee's rights under this option shall have passed by the Optionee's
will or by the laws of descent and distribution, and only to the extent the
option was exercisable on the date of death but had not previously been
exercised.
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12. RECAPITALIZATIONS, SALES, MERGERS, EXCHANGES, CONSOLIDATIONS,
LIQUIDATION. In the event of an increase or decrease in the number of shares of
Common Stock resulting from a subdivision or consolidation of shares or the
payment of a stock dividend or any other increase or decrease in the number of
shares of Common Stock effected without receipt of consideration by the Company,
the number of shares of Option Stock reserved under Section 6 hereof and the
number of shares of Option Stock covered by each outstanding option and the
price per share thereof shall be adjusted by the Board to reflect such change.
Additional shares which may be credited pursuant to such adjustments shall be
subject to the same restrictions as are applicable to the shares with respect to
which the adjustment relates.
Unless otherwise provided in the stock option agreement, in the event
of
(i) an acquisition of the Company by a corporation, partnership,
trust or other entity not controlled by the Company through
(A) the sale of substantially all of the Company's assets and
the consequent discontinuance of its business or (B) through a
merger, consolidation, exchange, reorganization,
reclassification, extraordinary dividend, divestiture or
liquidation of the Company, other than a merger or
consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at
least 80% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation (collectively
referred to as a transaction), or
(ii) a change of control such that (A) any individual, partnership,
trust or other entity becomes after the effective date of the
Plan the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of 30% or more of
the combined voting power of the Company's outstanding
securities ordinarily having the right to vote at elections of
directors of the Company, or (B) individuals who constitute
the Board of Directors of the Company on the effective date of
the Plan cease for any reason to constitute at least a
majority thereof, provided that any person becoming a director
subsequent to the effective date of the Plan whose election,
or nomination for election by the Company's shareholders, was
approved by a vote of at least a majority of the directors
comprising the Board of Directors of the Company on the
effective date of the Plan (either by a specific vote or by
approval of the proxy statement of the Company in which such
person is named as a nominee for director, without objection
to such nomination) shall be, for purposes of this clause (B)
considered as though such person were a member of the Board of
Directors of the Company on the effective date of the Plan
(collectively referred to as a "change of control"),
all outstanding options shall become immediately exercisable, whether or not
such options had become exercisable prior to the transaction or change of
control; provided, however, that if the acquiring party seeks to have the
transaction accounted for on a "pooling of interests" basis and, in the opinion
of the Company's independent certified public accountants, accelerating the
exercisability of such options would preclude a pooling of interests under
generally accepted accounting principles, the exercisability of such options
shall not accelerate. In addition to the foregoing, in the event of such a
transaction or change of control, the Board may provide for one or more of the
following:
(a) the complete termination of this Plan and cancellation of
outstanding options not exercisedprior to a date specified by the Board
(which date shall give Optionees a reasonable period of time in which
to exercise the options prior to the effectiveness of such
transactions);
(b) that Optionees holding outstanding incentive or nonqualified
options shall receive, with respect to each share of Option Stock
subject to such options, as of the effective date of any such
transaction, cash in an amount equal to the excess of the Fair Market
Value of such Option Stock on the date immediately preceding the
effective date of such transaction over the option price per share of
such options; provided that the Board may, in lieu of such cash
payment, distribute to such Optionees shares of stock of the Company or
shares of stock of any corporation succeeding the Company by reason of
such transaction, such shares having a value equal to the cash payment
herein; or
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(c) the continuance of the Plan with respect to the exercise of options
which were outstanding as of the date of adoption by the Board of such
plan for such transaction and provide to Optionees holding such options
the right to exercise their respective options as to an equivalent
number of shares of stock of the corporation succeeding the Company by
reason of such transaction.
The Board may restrict the rights of or the applicability of this Section 13 to
the extent necessary to comply with Section 16(b) of the Securities Exchange Act
of 1934, the Internal Revenue Code or any other applicable law or regulation.
The grant of an option pursuant to the Plan shall not limit in any way the right
or power of the Company to make adjustments, reclassifications, reorganizations
or changes of its capital or business structure or to merge, exchange or
consolidate or to dissolve, liquidate, sell or transfer all or any part of its
business or assets.
13. SCOPE OF AGREEMENT. This Agreement shall bind and inure to the
benefit of the Company and its successors and assigns and the Optionee and any
successor or successors of the Optionee permitted by Paragraph 4 above.
IN WITNESS WHEREOF, the Company and the Optionee have executed this
Agreement in the manner appropriate to each, as of the day and year first above
written.
TELTECH RESOURCE NETWORK CORPORATION
By
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Its CEO
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Optionee
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