Exhibit 10.1
PHASE FORWARD
INCORPORATED
2004 STOCK OPTION AND INCENTIVE
PLAN
As Amended and Restated
March 2009
1.
Purpose and
Eligibility
The purpose of this 2004 Stock
Option and Incentive Plan (the “ Plan ”) of
Phase Forward Incorporated (the “ Company ”) is
to provide stock options and other equity interests in the Company
(each an “ Award ”) to employees, officers,
directors, consultants and advisors of the Company and its
Subsidiaries, all of whom are eligible to receive Awards under the
Plan. Any person to whom an Award has been granted under the Plan
is called a “ Participant .” Additional
definitions are contained in Section 9.
2.
Administration
The Plan will be administered by the
Compensation Committee (the “ Committee ”) of
the Board of Directors of the Company (the “ Board
”). The Committee shall, subject to the provisions of the
Plan, have the power to construe this Plan, to determine all
questions hereunder, and to adopt and amend such rules and
regulations for the administration of this Plan as it may deem
desirable. No member of the Board or the Committee shall be liable
for any action or determination made in good faith with respect to
this Plan or any option granted under it.
3.
Stock Available for
Awards
a.
Number of Shares.
Subject to adjustment under
Section 3(c) and the next sentence, the aggregate number
of shares of Common Stock of the Company (the “ Common
Stock ”) that may be issued pursuant to the Plan is
3,981,505 shares. Subject to stockholder approval, the number of
reserved shares of Common Stock under the Plan shall be increased
from 3,981,505 shares to 5,481,505 shares. If any Award expires, or
is terminated, surrendered, cancelled or forfeited, in whole or in
part, the unissued Common Stock covered by such Award shall again
be available for the grant of Awards under the Plan. If shares of
Common Stock issued pursuant to the Plan are surrendered or
forfeited to, the Company, such shares of Common Stock shall again
be available for the grant of Awards under the Plan. Shares
tendered or held back upon exercise of an Option or settlement of
an Award to cover the exercise price or tax withholding shall not
be available for future issuance under the Plan. In addition, the
grant of a stock appreciation right shall reduce the number of
shares available for grant under the Plan by the gross number of
shares underlying such stock appreciation right. Upon the exercise
of such stock appreciation right, the authorized share pool under
this Section 3 shall not be credited with any additional
shares. Shares issued under the Plan may consist in whole or in
part of authorized but unissued shares or treasury
shares.
b.
Per-Participant Limit.
Subject to adjustment under
Section 3(c), no Participant may be granted Options or stock
appreciation rights during any one fiscal year to purchase more
than 750,000 shares of Common Stock.
c.
Adjustment to Common
Stock. In the
event of any stock split, stock dividend, extraordinary cash
dividend, recapitalization, reorganization, merger, consolidation,
combination, exchange of shares, liquidation, spin-off, split-up,
or other similar change in capitalization or event, (i) the
number and class of securities available for Awards under the Plan
and the per-Participant share limit, (ii) the number and class
of securities, vesting schedule and exercise price per share
subject to each outstanding Option, (iii) the repurchase price
per security subject to repurchase, and (iv) the terms of each
other outstanding stock- based Award shall be adjusted by the
Company (or substituted Awards
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may be made) to the extent the
Committee shall determine, in good faith, that such an adjustment
(or substitution) is appropriate. If
Section 8(e)(i) applies for any event, this
Section 3(c) shall not be applicable.
4.
Stock Options
a.
General. The Committee may grant options to
purchase Common Stock (each, an “ Option ”) and
determine the number of shares of Common Stock to be covered by
each Option, the exercise price of each Option and the conditions
and limitations applicable to the exercise of each Option and the
Common Stock issued upon the exercise of each Option, including
vesting provisions and restrictions relating to applicable federal
or state securities laws, as it considers advisable.
b.
Incentive Stock
Options. An Option
that the Committee intends to be an “incentive stock
option” as defined in Section 422 of the Code (an
“ Incentive Stock Option ”) shall be granted
only to employees of the Company and shall be subject to and shall
be construed consistently with the requirements of Section 422
of the Code. The Committee and the Company shall have no liability
if an Option or any part thereof that is intended to be an
Incentive Stock Option does not qualify as such. An Option or any
part thereof that does not qualify as an Incentive Stock Option is
referred to herein as a “ Nonstatutory Stock Option
.”
c.
Exercise Price.
The Committee shall establish
the exercise price (or determine the method by which the exercise
price shall be determined) at the time each Option is granted and
specify it in the applicable option agreement. The exercise price
of each Option shall not be less than 100 percent of the per
share fair market value of the Common Stock on the date of grant.
Fair market value shall be determined by reference to market
quotations on the Nasdaq National Market System.
d.
Duration of Options.
Each Option shall be
exercisable at such times and subject to such terms and conditions
as the Committee may specify in the applicable option agreement.
Each Option shall expire ten years after the date of
grant.
e.
Exercise of Option.
Options may be exercised only
by delivery to the Company of a written notice of exercise signed
by the proper person together with payment in full as specified in
Section 4(f) for the number of shares for which the
Option is exercised.
f.
Payment Upon Exercise.
Common Stock purchased upon
the exercise of an Option shall be paid for by one or any
combination of the following forms of payment:
(i)
by check payable to the order of the
Company;
(ii)
except as otherwise explicitly
provided in the applicable option agreement, and only if the Common
Stock is then publicly traded, delivery of an irrevocable and
unconditional undertaking by a creditworthy broker to deliver
promptly to the Company sufficient funds to pay the exercise price,
or delivery by the Participant to the Company of a copy of
irrevocable and unconditional instructions to a creditworthy broker
to deliver promptly to the Company cash or a check sufficient to
pay the exercise price; or
(iii)
to the extent explicitly provided in
the applicable option agreement, by (x) delivery of shares of
Common Stock owned by the Participant valued at fair market value
and which have been held by the Participant for at least six months
(as determined by the Committee or as determined pursuant to the
applicable option agreement), or (y) payment of such other
lawful consideration as the Committee may determine.
5.
Restricted Stock
a.
Grants. The Committee may grant a Restricted
Stock Award to a Participant. A Restricted Stock Award is an award
entitling the recipient to acquire, at such purchase price (which
may be zero)
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as determined by the Committee,
shares of Common Stock subject to such restrictions and conditions
as the Committee may determine (each, a “ Restricted Stock
Award ”). If a Participant’s employment (or other
service relationship) with the Company or its Subsidiary is
terminated prior to satisfaction of such restrictions and
conditions, any Restricted Stock that has not vested shall
automatically and without requirement of notice to the Participant
from the Company be deemed to be forfeited to the Company, subject
to the payment by the Company of the original purchase price for
such Restricted Stock, if any.
b.
Terms and Conditions.
The Committee shall determine
the terms and conditions of any such Restricted Stock Award.
Conditions may be based on continuing employment (or other service
relationship) and/or achievement of pre-established performance
goals and objectives. In the event a Restricted Stock Award granted
to an employee shall have a performance goal, the restriction
period with respect to such Award shall not be less than one year,
and in the event a Restricted Stock Award granted to an employee
shall be based on continuing employment, the total restriction
period with respect to such Award shall not be less than three
years; provided, however, the risks of forfeiture can lapse
incrementally over the three-year period. No dividends may be
earned under a Restricted Stock Award. Any stock certificates
issued in respect of a Restricted Stock Award shall be registered
in the name of the Participant and, unless otherwise determined by
the Committee, deposited by the Participant, together with a stock
power endorsed in blank, with the Company (or its designee). After
the expiration of the applicable restrictions and conditions, the
Company (or such designee) shall deliver the certificates no longer
subject to such restrictions to the Participant or, if the
Participant has died, to the beneficiary designated by a
Participant, in a manner determined by the Committee, to receive
amounts due or exercise rights of the Participant in the event of
the Participant’s death (the “ Designated
Beneficiary ”). In the absence of an effective
designation by a Participant, Designated Beneficiary shall mean the
Participant’s estate.
6.
Other Stock-Based
Awards
The Committee shall have the right
to grant other Awards based upon the Common Stock having such terms
and conditions as the Committee may determine, including, without
limitation, the grant of shares based upon certain conditions, the
grant of securities convertible into Common Stock and the grant of
stock appreciation rights, phantom stock awards or stock units. In
the event an Other Stock-Based Award granted to an employee shall
have a performance goal, the restriction period with respect to
such Award shall not be less than one year, and in the event an
Other Stock-Based Award granted to an employee shall be based on
continuing employment, the total restriction period with respect to
such Award shall not be less than three years; provided, however,
the risks of forfeiture can lapse incrementally over the three-year
period. No dividends may be earned under any other Stock-Based
Award.
7.
Performance-Based Awards to
Covered Employees
a.
Performance-Based
Awards. Any
employee or other key person providing services to the Company and
who is selected by the Committee may be granted one or more
Performance-Based Awards in the form of a Restricted Stock Award or
Other Stock-Based Award payable upon the attainment of Performance
Goals that are established by the Committee and relate to one or
more of the Performance Criteria, in each case on a specified date
or dates or over any period or periods determined by the Committee.
The Committee shall define in an objective fashion the manner of
calculating the Performance Criteria it selects to use for any
Performance Cycle. Depending on the Performance Criteria used to
establish such Performance Goals, the Performance Goals may be
expressed in terms of overall Company performance or the
performance of a division, business unit, or an individual. The
Committee, in its discretion, may adjust or modify the calculation
of Performance Goals for such Performance Cycle in order to prevent
the dilution or enlargement of the rights of an individual
(i) in the event of, or in anticipation of, any unusual or
extraordinary corporate item,
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transaction, event or development,
(ii) in recognition of, or in anticipation of, any other
unusual or nonrecurring events affecting the Company, or the
financial statements of the Company, or (iii) in response to,
or in anticipation of, changes in applicable laws, regulations,
accounting principles, or business conditions provided however,
that the Committee may not exercise such discretion in a manner
that would increase the Performance-Based Award granted to a
Covered Employee. Each Performance-Based Award shall comply with
the provisions set forth below.
(b)
Grant of Performance-Based
Awards. With
respect to each Performance-Based Award granted to a Covered
Employee, the Committee shall select, within the first 90 days
of a Performance Cycle (or, if shorter, within the maximum period
allowed under Section 162(m) of the Code) the Performance
Criteria for such grant, and the Performance Goals with respect to
each Performance Criterion (including a threshold level of
performance below whi
