INSO CORPORATION
Non-Qualified Stock Option Agreement
Under the Inso Corporation 1996 Non-Employee Director Incentive Plan
Optionee: [ ]
Date: [ ]
Pursuant to the terms of its 1996 Non-Employee Director Incentive Plan
(the "Plan"), Inso Corporation, a Delaware corporation (the "Company"),
hereby grants to [name] (the "Optionee") an option (the "Option") to purchase
up to [ ] shares (the "Option Shares") of the common stock, par value
$.01 per share, of the Company (the "Common Stock") at a purchase price
of [ ] per Option Share, on the terms and conditions set
forth herein and in the Plan. This Option is not intended to qualify as an
incentive stock option under section 422 of the Internal Revenue Code of
1986, as amended.
1. Term. The Option shall be exercisable, in whole or in part, on or prior
to [ ] (the "Expiration Date").
2. Vesting Schedule. Subject to the provisions of Sections 5 and 6 hereof
and the discretion of the Committee (as such term is defined in the Plan)
to accelerate the vesting of the Option, this Option shall become vested and
exercisable with respect to the following percentages of Option Shares as
set forth below:
Date Additional Percentage of Total Number of Option
Option Shares Available for Shares Available for
Purchase Purchase
3. Procedures for Exercise. The Option may be exercised by the Optionee
from time to time prior to the Expiration Date by delivering written
notice (each, an "Exercise Notice") to the Secretary of the Company
specifying the number of Option Shares to be purchased. An example of an
Exercise Notice is attached to this Agreement as Exhibit A. Payment of the
purchase price for the Option Shares may, at the Optionee's election, be
made (a) in cash, by certified or bank check or by other instrument
acceptable to the Committee, (b) in the form of shares of Common Stock that
are not subject to restrictions under any Company plan and that have been
held by the Optionee for at least six months, if permitted by the Committee
in its discretion, or (c) by delivery of a properly completed Exercise
Notice together with irrevocable instructions to a broker promptly to
deliver to the Company cash or a check payable and acceptable to the
Company to pay the purchase price in respect of the Option Shares to be
purchased. In the event that the Optionee shall elect to pay the purchase
price as provided in clause (c) of the preceding sentence, the
Optionee and the broker shall comply with such procedures and enter into
such agreements of indemnity and otherwise as the Committee shall prescribe
as a condition of such payment procedure. Payment instruments will be
received subject to collection. The Company's obligation to consummate the
transaction contemplated by the Exercise Notice shall be subject to the
Company's receipt of full payment for the Option Shares to
be purchased thereunder and any other agreement, document or instrument or
other evidence as the Company may require to establish that the issuance of
Option Shares to the Optionee pursuant to the Plan and any subsequent resale
of such Option Shares shall comply with any applicable law or regulation.
Certificates for Option Shares may be issued in the name of the Optionee
jointly with another person or in the name of an executor or administrator
of the Optionee's estate upon request. Notwithstanding any other provision
hereof or of the Plan, no portion of this Option shall be exercisable after
the Expiration Date.
4. Non-transferability of Option. This Option shall not be transferable by
the Optionee otherwise than by will or by laws of descent and distribution
and this Option shall be exercisable, during the Optionee's lifetime,
only by the Optionee.
5. Termination of Service. If the Optionee ceases to serve as a Director of
the Company, the period within which to exercise the Option shall terminate
three months after the date of such cessation or the Expiration Date,
whichever is earlier, and such Option shall be exercisable through such
date as to the Option Shares which were available for purchase
on the date the Optionee ceased to serve as a Director of the Company;
provided, however, that if the Optionee ceases to serve as a Director due
to Disability (as such term is defined in the Plan) or death, this Option
shall vest in full immediately. Any Option granted to an Optionee and
outstanding on the date he or she ceases to serve as a Director of the
Company due to Disability or death may be exercised by the Optionee
or by the legal representative or legatee of the Optionee for a period of
180 days from such date or until the Expiration Date, whichever is earlier.
6. Change in Control. Upon the occurrence of a Change in Control (as defined
in the Plan) any Option granted to an Optionee and outstanding on the date
immediately prior to the effective date of such Change in Control shall
become automatically exercisable in full.
7. Option Shares. The Option Shares are shares of the Common Stock of the
Company as constituted on the date of this Option was granted (including any
grant subject to a condition subsequent), subject to adjustment as provided
in Section 10 of the Plan.
8. No Special Rights. This Option does not confer upon the Optionee any
right with respect to continuation of service as a Director of the Company,
nor does it limit in any way the right of the Company to remove a Director
from service.
9. Rights as a Stockholder. The Optionee shall have no right as a
stockholder with respect to any Option Share unless and until a certificate
representing such Option Share is duly issued and delivered to the Optionee.
Except as expressly provided in the Plan, 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.
10. The Plan. In the event of any conflict or inconsistency between the
terms of this Agreement and the Plan, the terms and conditions of the Plan
shall control.
11. Miscellaneous. Notices hereunder shall be mailed or delivered to the
Company at its principal place of business to the attention of the Secretary
and shall be mailed or delivered to the Optionee at the address set forth
below, or, in either case, at such other address as one party may
subsequently furnish to the other party in writing.
INSO CORPORATION
By________________________
▇▇▇▇▇ ▇. ▇▇▇▇
Vice President and General
Counsel
▇▇▇▇▇▇ to and accepted
as of [ ]:
______________________
[ ]
EXHIBIT A
Inso Corporation
▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇.
Boston, MA 02116
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
NON-QUALIFIED STOCK OPTION EXERCISE FORM
This is notice that I am exercising Non-Qualified Stock Options granted to me
on_____________.
Number of Shares Covered in this Exercise: ____________________(A)
Exercise Price per Share $______________. ____(B)
TOTAL Exercise Price (AxB) $______________. ____
I intend to pay the exercise as follows:
_____ Cashless via broker
Broker's Name:__________________________________
Company:______________________________________
Phone:______________________ Fax:_______________
_____ In Cash (please attach a check payable to Inso Corporation)
_____ With previously owned Inso Corporation shares (if this method is
chosen, you will be provided with the number of shares required to complete
the exercise and the amount of additional cash required to pay for
fractional shares, if any).
I understand that the exercise of non-qualified stock options generates
taxable income and that it is necessary to have applicable Federal, State
and FICA taxes withheld. I intend to pay withholding taxes as follows:
_____ Cashless via broker, as above.
_____ Cash (please inform me of the amount owed and I will send a check
payable to Inso Corporation within five (5) business days).
_____ Shares (please inform me of the taxes due and arrange a reduction in
the number of shares issued).
__________________________________ ________________________
Signature Date
__________________________________
Print Name
FOR OFFICE USE ONLY:
Date
Received
Time
Received
AM
PM
Confirmed
Option on
Confirmed
Tax Amt
Due on
FICA Limit
Inso Close
on
@ $
Control #