Exhibit (d)(4)
Form of New Stock Option Agreement pursuant to the Portal Software, Inc. 2000
Supplemental Stock Option Plan
Exhibit (d)(4)
PORTAL SOFTWARE, INC.
NOTICE OF GRANT OF STOCK OPTION
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Notice is hereby given of the following option grant (the "Option") to
purchase shares of the Common Stock of Portal Software, Inc. (the
"Corporation"):
Optionee:_______________________________________________________
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Grant Date:_____________________________________________________
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Vesting Commencement Date:______________________________________
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Exercise Price: $_____________________________________ per share
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Number of Option Shares:_________________________________ shares
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Expiration Date:________________________________________________
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Type of Option: _______ Incentive Stock Option
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X Non-Statutory Stock Option
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Exercise Schedule: The Option shall become immediately exercisable
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for _______________ Option Shares and shall become exercisable for the
balance of the Option Shares in successive equal monthly installments
of ___________ shares upon Optionee's completion of each additional
month of Service commencing with (and measured from) the Vesting
Commencement Date. In no event shall the Option become exercisable
for any additional Option Shares after Optionee's cessation of
Service.
Optionee understands and agrees that the Option is granted subject to
and in accordance with the terms of the Portal Software, Inc. 2000 Supplemental
Stock Option Plan (the "Plan"). Optionee further agrees to be bound by the
terms of the Plan and the terms of the Option as set forth in the Stock Option
Agreement attached hereto as Exhibit A. Optionee hereby acknowledges that a
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copy of the official prospectus for the Plan has been made available to, or
otherwise delivered to, Optionee. A copy of the Plan is available upon request
made to the Corporate Secretary at the Corporation's principal offices.
Employment at Will. Nothing in this Notice or in the attached Stock
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Option Agreement or in the Plan shall confer upon Optionee any right to continue
in Service for any period of specific duration or interfere with or otherwise
restrict in any way the rights of the Corporation (or any Parent or Subsidiary
employing or retaining Optionee) or of Optionee, which rights are hereby
expressly reserved by each, to terminate Optionee's Service at any time for any
reason, with or without cause.
Definitions. All capitalized terms in this Notice shall have the
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meaning assigned to them in this Notice or in the attached Stock Option
Agreement.
DATED:______________________________, 2001
PORTAL SOFTWARE, INC.
By:___________________________________
Title:________________________________
______________________________________
OPTIONEE
Address:______________________________
______________________________________
ATTACHMENTS
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Exhibit A - Stock Option Agreement
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EXHIBIT A
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SUPPLEMENTAL STOCK OPTION PLAN
PORTAL SOFTWARE, INC.
STOCK OPTION AGREEMENT
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WITNESSETH:
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RECITALS
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A. The Corporation's Board of Directors (the "Board") has adopted
the Corporation's 2000 Supplemental Stock Option Plan (the "Plan") for the
purpose of attracting and retaining the services of employees who are neither
officers of the Corporation nor members of the Board.
B. Optionee is an individual who is to render valuable services to
the Corporation or one or more parent or subsidiary corporations, and this
Agreement is executed pursuant to, and is intended to carry out the purposes of,
the Plan in connection with the Corporation's grant of a stock option to
Optionee.
NOW, THEREFORE, it is hereby agreed as follows:
1. Grant of Option. Subject to and upon the terms and conditions set
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forth in this Agreement, the Corporation hereby grants to Optionee, as of the
grant date (the "Date of Grant") specified in the accompanying Notice of Grant
of Stock Option (the "Grant Notice"), a stock option to purchase up to that
number of shares of the Corporation's Common Stock (the "Option Shares") as is
specified in the Grant Notice. The Option Shares shall be purchasable from time
to time during the option term at the exercise price per share (the "Exercise
Price") specified in the Grant Notice. This option shall be a non-statutory
option which is not intended to meet the requirements of an incentive stock
option under Section 422 of the Internal Revenue Code.
2. Option Term. This option shall expire at the close of business on
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the expiration date (the "Expiration Date") specified in the Grant Notice,
unless sooner terminated in accordance with Paragraph 5 or 6.
3. Limited Transferability. This option shall be neither assignable
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nor transferable by Optionee other than by will or the laws of inheritance
following Optionee's death and may be exercised during Optionee's lifetime only
by Optionee. However, Optionee may designate one or more persons as the
beneficiary or beneficiaries of this option, and this option shall, in
accordance with such designation, automatically be transferred to such
beneficiary or beneficiaries upon the Optionee's death while holding such
option. Such beneficiary or beneficiaries shall take the transferred option
subject to all the terms and conditions of this Agreement, including (without
limitation) the limited time period during which this option may, pursuant to
Paragraph 5, be exercised following Optionee's death.
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4. Dates of Exercise. This option shall become exercisable for the
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Option Shares in accordance with the installment exercise schedule specified in
the Grant Notice. As the option becomes exercisable for one or more
installments, those installments shall accumulate, and the option shall remain
exercisable for the accumulated installments until the Expiration Date or sooner
termination of the option term under Paragraph 5 or Paragraph 6 of this
Agreement.
5. Cessation of Service. The option term specified in Paragraph 2
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shall terminate (and this option shall cease to be outstanding) prior to the
Expiration Date in accordance with the following provisions:
(i) Should Optionee cease Service for any reason (other
than death, Permanent Disability or Misconduct) while holding this option,
then Optionee shall have a period of three (3) months (commencing with the
date of such cessation of Service) during which to exercise this option,
but in no event shall this option be exercisable at any time after the
Expiration Date.
(ii) Should Optionee die while holding this option, then
the personal representative of Optionee's estate or the person or persons
to whom the option is transferred pursuant to Optionee's will or the laws
of inheritance shall have the right to exercise this option. However, if
Optionee has designated one or more beneficiaries of this option, then
those persons shall have the exclusive right to exercise this option
following Optionee's death. Any such right to exercise this option shall
lapse, and this option shall cease to be outstanding, upon the earlier of
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(A) the expiration of the twelve (12)-month period measured from the date
of Optionee's death or (B) the Expiration Date.
(iii) Should Optionee cease Service by reason of Permanent
Disability while holding this option, then Optionee shall have a period of
twelve (12) months (commencing with the date of such cessation of Service)
during which to exercise this option. In no event shall this option be
exercisable at any time after the Expiration Date.
(iv) During the limited period of post-Service
exercisability, this option may not be exercised in the aggregate for more
than the number of Option Shares for which the option is exercisable at the
time of Optioneee's cessation of Service. Upon the expiration of such
limited exercise period or (if earlier) upon the Expiration Date, this
option shall terminate and cease to be outstanding for any exercisable
Option Shares for which the option has not been exercised. However, this
option shall, immediately upon Optionee's cessation of Service for any
reason, terminate and cease to be outstanding with respect to any Option
Shares for which this option is not otherwise at that time exercisable.
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(v) Should Optionee's Service be terminated for Misconduct
or should Optionee otherwise engage in Misconduct while this option is
outstanding, then this option shall terminate immediately and cease to
remain outstanding.
(vi) For purposes of this Agreement, the following
definitional provisions shall be in effect:
A. Optionee shall be deemed to remain in Service for
so long as such individual performs services for the Corporation
(or any parent or subsidiary) in the capacity of an Employee or a
consultant or independent advisor.
B. Optionee shall be considered to be an Employee for
so long as such individual remains in the employ of the
Corporation (or any parent or subsidiary), subject to the control
and direction of the employer entity as to both the work to be
performed and the manner and method of performance.
C. Optionee shall be deemed to have ceased Service by
reason of Permanent Disability if Optionee is unable to engage in
any substantial gainful activity by reason of any medically-
determinable physical or mental impairment which is expected to
result in death or has lasted or can be expected to last for a
continuous period of twelve (12) months or more.
D. Misconduct shall mean the commission of any act of
fraud, embezzlement or dishonesty by Optionee, any unauthorized
use or disclosure by Optionee of confidential information or
trade secrets of the Corporation (or any parent or subsidiary),
or any other intentional misconduct by Optionee adversely
affecting the business or affairs of the Corporation (or any
parent or subsidiary) in a material manner. The foregoing
definition shall not be deemed to be inclusive of all the acts or
omissions which the Corporation (or any parent or subsidiary) may
consider as grounds for the dismissal or discharge of Optionee or
any other individual in the Service of the corporation (or any
parent or subsidiary).
E. A corporation shall be considered to be a
subsidiary of the Corporation if it is a member of an unbroken
chain of corporations beginning with the Corporation, provided
each corporation (other than the last corporation) in the
unbroken chain owns, at the time of the determination, stock
possessing fifty percent (50%) or more of the total combined
voting power of all classes of stock in one of the other
corporations in such chain.
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F. A corporation shall be considered to be a parent
of the Corporation if it is a member of an unbroken chain of
corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation)
owns, at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.
6. Corporate Transaction.
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A. In the event of any of the following stockholder-
approved transactions to which the Corporation is a party (a "Corporate
Transaction"):
(i) a merger or consolidation in which securities
possessing more than fifty percent (50%) of the total combined voting power
of the Corporation's outstanding securities are transferred to a person or
persons different from the persons holding those securities immediately
prior to such transaction, or
(ii) the sale, transfer or other disposition of all or
substantially all of the Corporation's assets in complete liquidation or
dissolution of the Corporation,
this option, to the extent outstanding at such time but not
otherwise fully exercisable, shall automatically accelerate so that such option
shall, immediately prior to the specified effective date for the Corporate
Transaction, become exercisable for all of the Option Shares at the time subject
to such option and may be exercised for any or all of those shares as fully-
vested shares. No such acceleration of this option, however, shall occur if and
to the extent: (i) this option is, in connection with the Corporate Transaction,
to be assumed by the successor corporation or parent thereof or (ii) such option
is to be replaced with a cash incentive program of the successor corporation
which preserves the option spread existing at the time of the Corporate
Transaction on the Option Shares for which the option is not otherwise at that
time exercisable (the excess of the Fair Market Value of those Option Shares
over the aggregate Exercise Price payable for such shares) and provides for
subsequent pay-out of that spread in accordance with the same vesting schedule
in effect for the Option Shares pursuant to the option exercise schedule set
forth in the Grant Notice.
B. This option shall terminate immediately following the
consummation of the Corporate Transaction and cease to be outstanding, except to
the extent expressly assumed by the successor corporation or parent thereof.
C. This Agreement shall not in any way affect the right of
the Corporation to adjust, reclassify, reorganize or otherwise make changes in
its capital or business structure or to merge, consolidate, dissolve, liquidate
or sell or transfer all or any part of its business or assets.
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7. Adjustment in Option Shares.
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A. In the event any change is made to the Common Stock issuable
under the Plan by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class effected without the Corporation's receipt
of consideration, the Plan Administrator shall make appropriate adjustments to
(i) the number and/or class of securities subject to this option and (ii) the
Exercise Price payable per share in order to prevent any dilution or enlargement
of benefits hereunder. Such adjustments shall be final, binding and conclusive.
B. If this option is to be assumed in connection with any
Corporate Transaction under Paragraph 6, then this option shall, immediately
after such Corporate Transaction, be appropriately adjusted to apply and pertain
to the number and class of securities which would have been issued to Optionee
in the consummation of such Corporate Transaction had the option been exercised
immediately prior to such Corporate Transaction. Appropriate adjustments shall
also be made to the Exercise Price payable per share, provided the aggregate
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Exercise Price payable hereunder shall remain the same.
8. Privilege of Stock Ownership. The holder of this option shall not
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have any of the rights of a stockholder with respect to the Option Shares until
such individual shall have exercised the option, paid the Exercise Price for the
purchased shares and become the holder of record of those shares.
9. Manner of Exercising Option.
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A. In order to exercise this option with respect to any or all
of the Option Shares for which this option is at the time exercisable, Optionee
(or in the case of exercise after Optionee's death, Optionee's executor,
administrator, heir or legatee, as the case may be) must take the following
actions:
(i) Deliver to the Corporate Secretary of the Corporation
an executed notice of exercise in substantially the form of Exhibit I to
this Agreement (the "Exercise Notice") in which there is specified the
number of Option Shares to be purchased under the exercised option.
(ii) Pay the aggregate Exercise Price for the purchased
shares through one or more of the following alternatives:
- full payment in cash or by check payable to the
Corporation;
- full payment in shares of Common Stock held for the
requisite period necessary to avoid a charge to the Corporation's earnings
for financial reporting purposes and valued at Fair Market Value on the
Exercise Date (as such term is defined below);
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- full payment in a combination of shares of Common Stock
held for the requisite period necessary to avoid a charge to the
Corporation's reported earnings and valued at Fair Market Value on the
Exercise Date and cash or check payable to the Corporation's order; or
- full payment effected through a broker-dealer sale and
remittance procedure pursuant to which Optionee shall provide irrevocable
instructions to (I) a Corporation-designated brokerage firm to effect the
immediate sale of the purchased shares and remit to the Corporation, out of
the sale proceeds available on the settlement date, sufficient funds to
cover the aggregate Exercise Price payable for the purchased shares plus
all applicable Federal, State and local income taxes and employment taxes
required to be withheld in connection with such purchase and (II) shall
provide written directives to the Corporation to deliver the certificates
for the purchased shares directly to such brokerage firm in order to
complete the sale transaction.
(iii) Furnish to the Corporation appropriate documentation
that the person or persons exercising the option (if other than Optionee)
have the right to exercise this option.
B. For purposes of this Agreement, the Exercise Date shall be
the date on which the executed Exercise Notice shall have been delivered to the
Corporation. Except to the extent the sale and remittance procedure specified
above is utilized in connection with the option exercise, payment of the
Exercise Price for the purchased shares must accompany such Exercise Notice. For
all valuation purposes under this Agreement, the Fair Market Value per share of
Common Stock on any relevant date shall be the closing selling price per share
of Common Stock on the date in question, as such price is reported by the
National Association of Securities Dealers on the Nasdaq National Market and
published in The Wall Street Journal. If there is no such reported price on the
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date in question, then the Fair Market Value shall be the closing selling price
on the last preceding date for which such quotation exists.
C. As soon as practical after receipt of the Exercise Notice,
the Corporation shall mail or deliver to or on behalf of Optionee (or any other
person or persons exercising this option in accordance herewith) a certificate
or certificates representing the purchased shares.
D. In no event may this option be exercised for any fractional
shares.
10. Governing Law. The interpretation, performance, and enforcement
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of this Agreement shall be governed by the laws of the State of California
without resort to that State's conflict-of-laws rules.
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11. Compliance with Laws and Regulations. The exercise of this option
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and the issuance of the Option Shares upon such exercise shall be subject to
compliance by the Corporation and Optionee with all applicable requirements of
law relating thereto and with all applicable regulations of any stock exchange
on which shares of the Corporation's Common Stock may be listed at the time of
such exercise and issuance.
12. Successors and Assigns. Except to the extent otherwise provided
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in Paragraph 3 or 6, the provisions of this Agreement shall inure to the benefit
of, and be binding upon, the successors, administrators, heirs and legal
representatives of Optionee and the successors and assigns of the Corporation.
13. Liability of Corporation. The inability of the Corporation to
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obtain approval from any regulatory body having authority deemed by the
Corporation to be necessary to the lawful issuance and sale of any Common Stock
pursuant to this option shall relieve the Corporation of any liability with
respect to the non-issuance or sale of the Common Stock as to which such
approval shall not have been obtaiwned. The Corporation however, shall use its
best efforts to obtain all such approvals.
14. At Will Employment. Nothing in this Agreement or in the Plan
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shall confer upon Optionee any right to continue in the Service of the
Corporation (or any parent or subsidiary employing or retaining Optionee) for
any period of specific duration or interfere with or otherwise restrict in any
way the rights of the Corporation (or any such parent or subsidiary) or
Optionee, which rights are hereby expressly reserved by each party, to terminate
Optionee's Service at any time for any reason whatsoever, with or without cause.
15. Notices. Any notice required to be given or delivered to the
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Corporation under the terms of this Agreement shall be in writing and addressed
to the Corporation in care of the Corporate Secretary at the Corporation's
principal offices at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. Any
notice required to be given or delivered to Optionee shall be in writing and
addressed to Optionee at the address indicated on the Grant Notice. All notices
shall be deemed to have been given or delivered upon personal delivery or upon
deposit in the U.S. mail, by registered or certified mail, postage prepaid and
properly addressed to the party to be notified.
16. Construction. This Agreement and the option evidenced hereby are
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made and granted pursuant to the Plan and are in all respects limited by and
subject to the express terms and provisions of the Plan. All decisions of the
Plan Administrator with respect to any question or issue arising under the Plan
or this Agreement shall be conclusive and binding on all persons having an
interest in this option.
17. Tax Withholding. Optionee shall make appropriate arrangements
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with the Corporation or any parent or subsidiary employing Optionee for the
satisfaction of all Federal, State and local income and employment withholding
taxes applicable to the exercise of this option.
18. Mandatory Arbitration. ANY AND ALL DISPUTES OR CONTROVERSIES
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BETWEEN OPTIONEE AND THE CORPORATION ARISING OUT OF,
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RELATING TO OR OTHERWISE CONNECTED WITH THIS AGREEMENT OR THE OPTION EVIDENCED
HEREBY OR THE VALIDITY, CONSTRUCTION, PERFORMANCE OR TERMINATION OF THIS
AGREEMENT SHALL BE SETTLED EXCLUSIVELY BY BINDING ARBITRATION TO BE HELD IN THE
COUNTY IN WHICH THE OPTIONEE IS (OR HAS MOST RECENTLY BEEN) EMPLOYED BY THE
CORPORATION (OR ANY PARENT OR SUBSIDIARY) AT THE TIME OF SUCH ARBITRATION. THE
ARBITRATION PROCEEDINGS SHALL BE GOVERNED BY (i) THE NATIONAL RULES FOR THE
RESOLUTION OF EMPLOYMENT DISPUTES THEN IN EFFECT OF THE AMERICAN ARBITRATION
ASSOCIATION AND (ii) THE FEDERAL ARBITRATION ACT. THE ARBITRATOR SHALL HAVE THE
SAME, BUT NO GREATER, REMEDIAL AUTHORITY AS WOULD A COURT HEARING THE SAME
DISPUTE. THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE AND BINDING
ON THE PARTIES TO THE ARBITRATION AND SHALL BE IN LIEU OF THE RIGHTS THOSE
PARTIES MAY OTHERWISE HAVE TO A JURY TRIAL; PROVIDED, HOWEVER, THAT SUCH
DECISION SHALL BE SUBJECT TO CORRECTION, CONFIRMATION OR VACATION IN ACCORDANCE
WITH THE PROVISIONS AND STANDARDS OF APPLICABLE LAW GOVERNING THE JUDICIAL
REVIEW OF ARBITRATION AWARDS. THE PREVAILING PARTY IN SUCH ARBITRATION, AS
DETERMINED BY THE ARBITRATOR, AND IN ANY ENFORCEMENT OR OTHER COURT PROCEEDINGS,
SHALL BE ENTITLED, TO THE EXTENT PERMITTED BY LAW, TO REIMBURSEMENT FROM THE
OTHER PARTY FOR ALL OF THE PREVAILING PARTY'S COSTS (INCLUDING BUT NOT LIMITED
TO THE ARBITRATOR'S COMPENSATION), EXPENSES AND ATTORNEY'S FEES. JUDGMENT SHALL
BE ENTERED ON THE ARBITRATOR'S DECISION IN ANY COURT HAVING JURISDICTION OVER
THE SUBJECT MATTER OF SUCH DISPUTE OR CONTROVERSY. NOTWITHSTANDING THE
FOREGOING, EITHER PARTY MAY IN AN APPROPRIATE MATTER APPLY TO A COURT PURSUANT
TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1281.8, OR ANY COMPARABLE
STATUTORY PROVISION OR COMMON LAW PRINCIPLE, FOR PROVISIONAL RELIEF, INCLUDING A
TEMPORARY RESTRAINING ORDER OR A PRELIMINARY INJUNCTION. TO THE EXTENT PERMITTED
BY LAW, THE PROCEEDINGS AND RESULTS, INCLUDING THE ARBITRATOR'S DECISION, SHALL
BE KEPT CONFIDENTIAL.
19. Data Protection and Privacy Consent. Information regarding this
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option and the Optionee, such as name, address, number of shares, exercise
price, number of shares vested and exercised, employment status (including
leaves of absence), employee or social security identification numbers, and the
gross and net proceeds of any sale of option shares, (collectively, "Stock
Administration Data") may be considered personal or sensitive data that is
subject to laws or regulations relating to the protection or privacy of such
data. The collection, communication and use of this data by the Corporation and
its subsidiaries, agents and brokers is essential to the proper administration
of the Plan and the exercise of rights under this Option. Optionee's Stock
Administration Data is subject to collection and storage by the Corporation and
its subsidiaries in both in computerized data bases and in paper files and will
be communicated to employee of the Corporation and to one or more of the
Corporation's subsidiaries in connection with the performance of stock
administration, taxation and accounting and human
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resources management activities. In addition, it may be communicated to third
parties with who the Corporation has contracted to perform stock administration
services for the Corporation and to one or more brokers that the Corporation has
designated to provide stock brokerage services to employees of the Corporation
(and its subsidiaries). Such data may therefore be transferred outside the
Optionee's country of residence to other countries. By accepting this Option,
either by signing the Grant Notice or by exercising any part of this Option,
Optionee hereby expressly agrees and consents to (i) the collection, use and
storage by the Corporation and its subsidiaries of the Stock Administration
Data, (ii) the communication of Stock Administration Data to employees of the
Corporation and its subsidiaries for purposes relating to stock administration,
taxation and accounting, and human resources management, and (iii) the
communication of Stock Administration Data to third parties and brokers
performing stock administration services for the Corporation or stock brokerage
services, all without any notice to Optionee and in any country.
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EXHIBIT I
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NOTICE OF EXERCISE OF STOCK OPTION
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I hereby notify Portal Software, Inc. (the "Corporation") that I elect
to purchase ______________ shares of the Corporation's Common Stock (the
"Purchased Shares") at the option exercise price of $_____________ per share
(the "Exercise Price") pursuant to that certain option (the "Option") granted to
me under the Corporation's 2000 Supplemental Stock Option Plan on
______________________, 20___.
Concurrently with the delivery of this Exercise Notice to the
Corporate Secretary of the Corporation, I shall hereby pay to the Corporation
the Exercise Price for the Purchased Shares in accordance with the provisions of
my agreement with the Corporation evidencing the Option and shall deliver
whatever additional documents may be required by such agreement as a condition
for exercise. Alternatively, I may utilize the special broker-dealer sale and
remittance procedure specified in my agreement to effect the payment of the
Exercise Price for the Purchased Shares.
____________________, 20___
Date
___________________________
Optionee
Address:___________________
___________________________
Print name in exact manner it is to
appear on the stock certificate: ___________________________
Address to which certificate is to
be sent, if different from address
above: ___________________________
___________________________
Social Security Number: ___________________________
Employee Number: ___________________________
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