PROS STRATEGIC SOLUTIONS, INC. 1997 STOCK OPTION PLAN

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Exhibit 10.1

PROS STRATEGIC SOLUTIONS, INC.
1997 STOCK OPTION PLAN

PROS STRATEGIC SOLUTIONS, INC.

1997 STOCK OPTION PLAN

TABLE OF CONTENTS

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ARTICLE I

Plan

        1.1     Purpose .    This Plan is intended to advance the best interests of the Company, its Affiliates, and its shareholders by providing those persons who have substantial responsibility for the management and growth of the Company and its Affiliates with additional incentives and an opportunity to obtain or increase their proprietary interest in the Company, thereby encouraging them to continue to provide services to the Company or any of its Affiliates.

        1.2     Effective Date of Plan.     This Plan is effective May 1, 1997, if within one year of that date it shall have been approved by at least a majority vote of shareholders voting in person or by proxy at a duly held shareholders' meeting, or if the provisions of the Company's Articles of Incorporation or By-laws or applicable state law prescribes a greater degree of shareholder approval for this action, the approval by the holders of that percentage, at a duly held meeting of shareholders. No Incentive Option or Nonqualified Option shall be granted pursuant to this Plan after April 30, 2007.

ARTICLE II

Definitions

        The words and phrases defined in this Article shall have the meaning set out in these definitions throughout this Plan, unless the context in which any such word or phrase appears reasonably requires a broader, narrower, or different meaning.

        2.1    "Affiliate" means any parent corporation and any subsidiary corporation. The term "parent corporation" means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company if, at the time of the action or transaction, each of the corporations other than the Company owns stock possessing more than 50% of the total combined voting power of all classes of stock in one of the other corporations in the chain. The term "subsidiary corporation" means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if, at the time of the action or transaction, each of the corporations other than the last corporation in the unbroken chain owns stock possessing more than 50% of the total combined voting power of all classes of stock in one of the other corporations in the chain.

        2.2    "Board of Directors" means the board of directors of the Company.

        2.3    "Code" means the Internal Revenue Code of 1986, as amended.

        2.4    "Committee" means the Board of Directors or a committee of the Board of Directors designated by the Board of Directors to administer the Plan.

        2.5    "Company" means PROS Strategic Solutions, Inc., a Texas corporation.

        2.6    "Disability" means the medically determinable mental or physical incapability of an employee to engage in any substantial gainful activity, which incapacity is reasonably expected to (or does in fact) continue for 12 months or more. If there is any disagreement between an employee and the Company with respect to whether such employee is disabled, then the Company and such employee shall obtain a determination from an impartial reputable physician selected for the purpose of making such determination, whose decision shall be binding upon all parties. If the Company and such employee cannot agree upon the selection of such physician, the then current president of the Harris County, Texas, Medical Society may make the selection of such physician, which selection shall be binding upon all parties and such physician's decision shall be binding upon all parties.

        2.7    "Fair Market Value" of the Stock as of any date means the value of the Stock as determined by the Committee in its sole discretion.

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        2.8    "Incentive Option" means an option granted under this Plan which is designated as an "Incentive Option" and satisfies the requirements of section 422 of the Code.

        2.9    "Nonqualified Option" means an option granted under this Plan other than an Incentive Option.

        2.10  "Option" means both an Incentive Option and a Nonqualified Option granted under this Plan to purchase shares of Stock.

        2.11  "Option Agreement" means the written agreement that sets out the terms of an Option, as such written agreement may be amended from time to time.

        2.12  "Optionee" means a person to whom an Option is granted.

        2.13  "Plan" means the PROS Strategic Solutions, Inc. 1997 Stock Option Plan, as set out in this document and as it may be amended from time to time.

        2.14  "Retirement" means retirement in good standing from the employ of the Company and all Affiliates under the rules of the Company in effect at the time of the Optionee's severance from employment with the Company and all Affiliates.

        2.15  "Stock" means the common stock of the Company, or, in the event that the outstanding shares of common stock are later changed into or exchanged for a different class of stock or securities of the Company or another corporation, that other stock or security.

        2.16  "10% Shareholder" means an individual who, at the time the Option is granted, owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of any Affiliate. An individual shall be considered as owning the stock owned, directly or indirectly, by or for his brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants; and stock owned, directly or indirectly, by or for a corporation, partnership, estate, or trust, shall be considered as being owned proportionately by or for its shareholders, partners, or beneficiaries.

ARTICLE III

Eligibility

        The individuals who shall be eligible to receive Incentive Options shall be those employees of the Company or any of its Affiliates as the Committee shall determine from time to time. The individuals who shall be eligible to receive Nonqualified Stock Options shall be such individuals as the Committee shall determine from time to time. The Board of Directors may designate one or more individuals who shall not be eligible to receive any Option under this Plan.

ARTICLE IV

General Provisions Relating to Options

        4.1     Authority to Grant Options .    The Committee may grant Options to persons selected by it in accordance with the terms and conditions of this Plan. Subject only to any applicable limitations set out in this Plan, the number of shares of Stock to be covered by any Option to be granted to an Optionee shall be as determined by the Committee.

        4.2     Dedicated Shares.     The total number of shares of Stock with respect to which Options may be granted under the Plan shall be 58,665 shares. The shares may be treasury shares or authorized but unissued shares. The number of shares stated in this Section 4.2 shall be subject to adjustment in accordance with the provisions of Section 4.5.

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        In the event that any outstanding Option shall expire or terminate for any reason or any Option is surrendered, the shares of Stock allocable to the unexercised portion of that Option may again be subject to an Option under the Plan.

        4.3     Non-Transferability.     Options shall not be transferable by the Optionee otherwise than by will or under the laws of descent and distribution, and shall be exercisable, during the Optionee's lifetime, only by him.

        4.4     Requirements of Law.     The Company shall not be required to sell or issue any Stock under any Option if issuing that Stock would constitute or result in a violation by the Optionee or the Company of any provision of any law, statute, or regulation of any governmental authority. Specifically, in connection with any applicable statute or regulation relating to the registration of securities, upon exercise of any Option, the Company shall not be required to issue any Stock unless the Committee has received evidence satisfactory to it to the effect that the holder of that Option will not transfer the Stock except in accordance with applicable law, including receipt of an opinion of counsel satisfactory to the Company to the effect that any proposed transfer complies with applicable law. The determination by the Committee on this matter shall be final, binding and conclusive. The Company may, but shall in no event be obligated to, register any Stock covered by this Plan pursuant to applicable securities laws of any country or any political subdivision. In the event the Stock issuable on exercise of an Option is not registered, the Company may imprint on the certificate evidencing the Stock any legend that counsel for the Company considers necessary or advisable to comply with applicable law. The Company shall not be obligated to take any other affirmative action in order to cause the exercise of an Option and the issuance of shares thereunder, to comply with any law or regulation of any governmental authority.

        4.5     Changes in the Company's Capital Structure.     (a) The existence of outstanding Options shall not affect in any way the right or power of the Company or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company's capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Stock or its rights, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

        (b)   If the Company shall effect a subdivision or consolidation of shares or other capital adjustment of, or the payment of a dividend in capital stock or other equity securities of the Company on, Stock, or other increase or reduction of the number of shares of Stock without receiving consideration therefor in money, services, or property, or the reclassification of Stock, in whole or in part, into other equity securities of the Company, then (i) the number, class and per share price of shares of Stock subject to outstanding Options hereunder shall be appropriately adjusted (or in the case of the issuance of other equity securities as a dividend on, or in a reclassification of, Stock, the Options shall extend to such other securities) in such a manner as to entitle an Optionee to receive, upon exercise of an Option, for the same aggregate cash consideration, the same total number and class or classes of shares (or in the case of a dividend of, or reclassification into, other equity securities, such other securities) he would have held after such adjustment if he had exercised his Option in full

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immediately prior to the event requiring the adjustment, or, if applicable, the record date for determining shareholders to be affected by such adjustment; and (ii) the number and class of shares then reserved for issuance under this Plan (or in the case of a dividend of, or reclassification into, other equity securities, such other securities) shall be adjusted by substituting for the total number and class of shares of Stock then received, the number and class or classes of shares of Stock (or in the case of a dividend of, or reclassification into, other equity securities, such other securities) that would have been received by the owner of an equal number of outstanding shares of Stock as a result of the event requiring the adjustment. Comparable rights shall accrue to each Optionee in the event of successive subdivisions, consolidations, capital adjustments, dividends or reclassifications of the character described above.

        (c)   If (i) the Company shall not be the surviving entity in any merger, consolidation or other reorganization (or survives only as a subsidiary of an entity other than a previously wholly-owned subsidiary of the Company), (ii) the Company sells, leases or exchanges or agrees to sell, lease or exchange all or substantially all of its assets to any other person or entity (other than a wholly-owned subsidiary of the Company), or (iii) the Company is to be dissolved and liquidated (each such event is referred to herein as a "Corporate Change"), no later than ten (10) days after the approval by the shareholders of the Company of such merger, consolidation, reorganization, sale, lease or exchange of assets or dissolution, the Committee, acting in its sole discretion without the consent or approval of any Optionee, shall act to effect one or more of the following alternatives, which may vary among individual Optionees and which may vary among Options held by any individual Optionee: (1) accelerate the time at which Options then outstanding may be exercised so that such Options may be exercised in full for a limited period of time on or before a specified date (before or after such Corporate Change) fixed by the Committee, after which specified date all unexercised Options and all rights of Optionees thereunder shall terminate, (2) require the mandatory surrender to the Company by selected Optionees of some or all of the outstanding Options held by such Optionees (irrespective of whether such Options are then exercisable under the provisions of this Plan or the Option Agreements evidencing such Options) as of a date, before or after such Corporate Change, specified by the Committee, in which event the Committee shall thereupon cancel such Options and the Company shall pay to each Optionee an amount of cash per share equal to the excess, if any, of the per share price offered to shareholders of the Company in any such merger, consolidation, reorganization, sale of assets or dissolution transaction over the exercise price(s) under such Options for such shares, (3) make such adjustments to the number and class of shares then reserved for issuance under this Plan and/or to Options then outstanding as the Committee deems appropriate to reflect such Corporate Change, including, but not limited to, having Options then outstanding assumed by the corporation surviving as a result of such Corporate Change and/or having a new option substituted by such surviving corporation for Options then outstanding (provided, however, that the Committee may determine in its sole discretion that no such adjustment is necessary), or (4) provide that the number and class of shares of Stock covered by an Option theretofore granted shall be adjusted so that such Option shall thereafter cover the number and class of shares of stock or other securities or property (including, without limitation, cash) to which the Optionee would have been entitled pursuant to the terms of the agreement of merger, consolidation or sale of assets and dissolution if, immediately prior to such merger, consolidation or sale of assets and dissolution, the Optionee had been the holder of record of the number of shares of Stock then covered by such Option.

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        (d)   In the event of changes in the outstanding Stock by reason of recapitalizations, reorganizations, mergers, consolidations, combinations, exchanges or other relevant changes in capitalization occurring after the date of the grant of any Option and not otherwise provided for by this Section 4.5, any outstanding Options and any agreements evidencing such Options shall be subject to adjustment by the Committee at its discretion as to the number and price of shares of stock or other consideration subject to such Options. In the event of any such change in the outstanding Stock, the aggregate number of shares available under this Plan may be appropriately adjusted by the Committee, whose determination shall be conclusive.

        (e)   The issue by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe for them, or upon conversion of shares or obligations of the Company convertible into shares or other securities, shall not affect, and no adjustment by reason of such issuance shall be made with respect to, the number, class, or price of shares of Stock then subject to outstanding Options.

        4.6     Market Stand-Off Agreement .    In connection with any underwritten public offering after the effective date of this Plan pursuant to an effective registration statement under the Securities Act of 1933, as amended, or any successor Federal statute, and the rules and regulations of the Securities and Exchange Commission promulgated thereunder, as in effect from time to time (the "Securities Act"), covering the offering and sale of shares of Stock, or of any equity security that as a part of a unit includes Stock, for the account of the Company, an Optionee, if and to the extent requested in good faith by the Company and the managing underwriter of securities of the Company, shall agree not to sell or otherwise transfer or dispose of any shares of Stock held by him or her or acquired by him or her pursuant to the exercise of an Option (except shares of Stock included in the registration statement relating to such underwritten public offering) at any time during a period following the effective date of the registration statement relating to such underwritten public offering; provided , however , that in no event shall such period exceed 180 days. In order to enforce the foregoing covenant, subject to the foregoing exceptions, the Company may impose stop-transfer instructions with respect to such shares of Stock of an Optionee (and the securities of every other person subject to such restriction) until the end of such period. The provisions of this Section 4.6 shall apply until the earlier to occur of (i) five (5) years following the effective date of the "First Qualified Public Offering" (as hereinafter defined), or (ii) such time as an Optionee can sell all remaining shares of Stock held by him or her within a ninety (90) day period pursuant to Rule 144 or 145 under the Securities Act. For purposes of this Section 4.6, the term "First Qualified Public Offering" means a firm commitment underwriting that satisfies any requirement contained in the Company's charter document relating to the aggregate net proceeds attributable to sales for the account of the Company with respect to an underwritten public offering or, if the Company's charter document contains no such requirement, the first underwritten public offering of the Company for the sale of Stock of which the aggregate net proceeds attributable to sales for the account of the Company exceed $20,000,000.

ARTICLE V

Options

        5.1     Type of Option.     The Committee shall specify whether a given Option shall constitute an Incentive Option or a Nonqualified Option.

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        5.2     Option Price.     The price at which Stock may be purchased under an Incentive Option shall not be less than the greater of: (a) 100% of the Fair Market Value of the shares of Stock on the date the Option is granted or (b) the aggregate par value of the shares of Stock on the date the Option is granted or, if the Shares are without par value on the date the Option is granted, such consideration, expressed in dollars, as may be fixed from time to time by the Board of Directors. The Committee in its discretion may provide that the price at which shares of Stock may be purchased under an Incentive Option shall be more than 100% of Fair Market Value. In the case of any 10% Shareholder, the price at which shares of Stock may be purchased under an Incentive Option shall not be less than 110% of the Fair Market Value of the Stock on the date the Incentive Option is granted.

        The price at which shares of Stock may be purchased under a Nonqualified Option shall not be less than the greater of: (a) 80% of the Fair Market Value of the shares of Stock on the date the Option is granted or (b) the aggregate par value of the shares of Stock on the date the Option is granted or, if the Shares are without par value on the date the Option is granted, such consideration, expressed in dollars, as may be fixed from time to time by the Board of Directors. The Committee in its discretion may provide that the price at which shares of Stock may be purchased under a Nonqualified Option shall be more than 100% of Fair Market Value.

        5.3     Duration of Options.     No Option shall be exercisable after the expiration of ten (10) years from the date the Option is granted. In the case of a 10% Shareholder, no Incentive Option shall be exercisable after the expiration of five years from the date the Incentive Option is granted.

        5.4     Amount Exercisable—Incentive Options.     Each Option may be exercised from time to time, in whole or in part, in the manner and subject to the conditions the Committee, in its sole discretion, may provide in the Option Agreement, as long as the Option is valid and outstanding. To the extent that the aggregate Fair Market Value (determined as of the time an Incentive Option is granted) of the Stock with respect to which Incentive Options first become exercisable by the Optionee during any calendar year (under this Plan and any other incentive stock option plan(s) of the Company or any Affiliate) exceeds $100,000, the Incentive Options shall be treated as Nonqualified Options. In making this determination, Incentive Options shall be taken into account in the order in which they were granted.

        5.5     Exercise of Options.     Each Option shall be exercised by the delivery of written notice to the Committee setting forth the number of shares of Stock with respect to which the Option is to be exercised, together with: (a) cash, certified check, bank draft, or postal or express money order payable to the order of the Company, (b) Stock at its Fair Market Value on the date of exercise, and/or (c) any other form of payment which is acceptable to the Committee, in each case for an amount equal to the exercise price of such shares, and specifying the address to which the certificates for such shares are to be mailed; provided , however , that any share of Stock delivered as payment, in whole or in part, of such exercise price must either (i) not have been acquired by the Optionee from the Company, or (ii) have been held by the Optionee for at least six (6) months prior to such exercise. As promptly as practicable after receipt of written notification and payment, the Company shall de